, and community groups around the country to help homeowners avoid foreclosures. we have called on mortgage lenders and servicers to pursue prudent loan workouts and have supported the development of streamlined, systematic approaches to expedite the loan modification process. we also have been providing community groups, counseling agencies, regulators, and others with detailed analyses to help identify neighborhoods at high risk from foreclosures so that local outreach efforts to help troubled borrowers can be as focused and effective as possible. we are actively pursuing other ways to leverage the federal reserve's analytical resources, regional presence, and community connections to address this critical issue. in addition to our consumer protection efforts in the mortgage area, we are working toward finalizing rules under the truth in lending act that will require new, more informative, and consumer - tested disclosures by credit card issuers. separately, we are actively reviewing potentially unfair and deceptive practices by issuers of credit cards. using the board's authority under the federal trade commission act, we expect to issue proposed rules regarding these practices this spring. thank you. i would be pleased to take your questions.

lower ; the improvement reflects the effects of policy stimulus and an anticipated moderation of the contraction in housing and the strains in financial and credit markets. the incoming information since our january meeting continues to suggest sluggish economic activity in the near term. the risks to this outlook remain to the downside. the risks include the possibilities that the housing market or labor market may deteriorate more than is currently anticipated and that credit conditions may tighten substantially further. consumer price inflation has increased since our previous report, in substantial part because of the steep run - up in the price of oil. last year, food prices also increased significantly, and the dollar depreciated. reflecting these influences, the price index for personal consumption expenditures ( pce ) increased 3. 4 percent over the four quarters of 2007, up from 1. 9 percent in 2006. core price inflation – that is, inflation excluding food and energy prices – also firmed toward the end of the year. the higher recent readings likely reflected some pass - through of energy costs to the prices of core consumer goods and services as well as the effect of the depreciation of the dollar on import prices. moreover, core inflation in the first half of 2007 was damped by a number of transitory factors – notably, unusually soft prices for apparel and for financial services – which subsequently reversed. for the year as a whole, however, core pce prices increased 2. 1 percent, down slightly from 2006. the projections recently submitted by fomc participants indicate that overall pce inflation was expected to moderate significantly in 2008, to between 2. 1 percent and 2. 4 percent ( the central tendency of the projections ). a key assumption underlying those projections was that energy and food prices would begin to flatten out, as was implied by quotes on futures markets. in addition, diminishing pressure on resources is also consistent with the projected slowing in inflation. the central tendency of the projections for core pce inflation in 2008, at 2. 0 percent to 2. 2 percent, was a bit higher than in our july report, largely because of some higher - than - expected recent readings on prices. beyond 2008, both overall and core inflation were projected to edge lower, as participants expected inflation expectations to remain reasonably well - anchored and pressures on resource utilization to be muted. the inflation projections submitted by fomc participants for 2010 – which ranged from 1. 5 percent to 2. 0 percent for overall pce inflation – were importantly influenced by