The organization said that in these years the number of homes in poverty decreased from more than 40% to 30%

It described this advance as important and stated that it is related to Venezuelans' higher income levels and as a result of the social missions.

The Bank explained that there is still a long way to go because "the objective is to not have anyone [living] below the poverty line and Venezuela is a petroleum country that is going through a time of high international oil prices and because of this should apply all these resources to poverty elimination."

These statements were made during consultations which took place yesterday....[These consultations], which will be jointly developed with the Planning Ministry, will be a step towards the design of a new cooperation strategy between the Bank and the country.

"The goal, in addition to conducting an analysis of the different priorities in the region, is to learn the opinions of representatives from different sectors in Zulia concerning the role of the institution in the nation and concerning the different options for cooperation," [David] Varela, [the resident World Bank Representative in Venezuela] said.

Varela has identified four important lines of work in Venezuela-all in accord with the millennium challenge--: water and plumbing, environmental management (solid waste management), [and] social infrastructure in medium size cities with more than 100,000 residents and in indigenous villages.

During the question and answer session, the inability of different local premises to qualify to obtain help from multinational organization in project development was mentioned.

One of the examples of a projected which was not successful in passing the final face to receive World Bank Aid that was mentioned was [a project concerning] the quality of air in an urban space, a proposal which had been presented by Maracaibo's mayor's office.

Among the commentaries, one criticized that there was no team prepared to explain technical information on the different problems that could be encountered [when a group is] being backed by international financial institutions, [a situation which creates] and important dependency.

The attendees confirmed that more or less the same thing happened [when groups were working] to obtain financing from the Intergovernmental fund for Decentralization (Fides) and the Law of Special Assignments. In this sense, the representatives of the different Zulian sectors expressed their concern about the little preparation that there was on the topic, which also is necessary and indispensable for the communal counsels to obtain endorsements for many of their programs.

[Valera] said that the [World Bank's view] for this year and next is that the nation keeps within a program of very modest borrowing, given that the need for external financing is very small.

"Even though we don't have any prepared figures, if we have a small borrowing program complemented with non financial study services, technical assistance and donations, that will enrich our contribution to the country," said the World Bank representative.

Analysts said that it is a sign that the U.S. Fed will continue to increase the short-term interest rate in the policy-making meeting to be held at the end of this month.

The U.S. Fed has increased short-term interest rates for 16 times since June 2004 and raised the federal fund rate to 5 percent last month.

High energy prices aggravated concerns over inflation as world crude oil prices hovered above 72 dollars Monday. New York's main contract, light sweet crude for delivery in July, added 27 cents to close at 72.60 dollars a barrel.

At the closing bell, the Dow Jones Industrial Average dropped 199.15, or 1.77 percent, to 11,048.72. The Standard & Poor's 500 index fell 22.93, or 1.78 percent, to 1,265.29. The Nasdaq composite index plunged 49.79, or 2.24 percent, to 2,169.62.

The comments were viewed ominously in financial markets, because the Fed recently vowed to base interest rate decisions on incoming economic data. Stocks extended a sharp decline in the aftermath of the comments, while the yield on the 10-year note moved to 5.02% from 5%.

"While monthly inflation data are volatile, core inflation measured over the past three to six months has reached a level that, if sustained, would be at or above the upper end of the range that many economists, including myself, would consider consistent with price stability and the promotion of maximum long-run growth," Bernanke said.

On the issue of wage inflation, Bernanke noted that productivity has held down unit labor costs for years, but suggested the job market might be getting over-extended.

"Anecdotal reports suggest ... that the labor market is tight in some industries and occupations and that employers are having difficulty attracting certain types of skilled workers," he noted.

The Fed chairman also said that inflation expectations might be growing.

"Some survey-based measures of longer-term inflation expectations have edged up, on net, in recent months, as has the compensation for inflation and inflation risk implied by yields on nominal and inflation-indexed government debt," he said. "As yet, these expectations measures have remained within the ranges in which they have fluctuated in recent years, but these developments bear watching."

Bernanke said the economy has entered a "period of transition" where, after three years of robust growth, capacity slack has narrowed and "a sustainable, non-inflationary expansion is likely to involve some moderation in the growth of economic activity to a rate more consistent with the expansion of the nation's underlying productive capacity."

"Real gross domestic product grew rapidly in the first quarter of this year, but the anticipated moderation of economic growth seems now to be under way. Consumer spending, which makes up more than two-thirds of total spending, has decelerated noticeably in recent months."

Average retail gasoline prices peaked at $3.07 a gallon last September, reflecting the extreme tightness in the market following Hurricane Katrina, which knocked out refineries in the Gulf region as well as pipelines that deliver fuel to the East Coast and Midwest.

Gasoline prices were most expensive last week on the West Coast, averaging $3.20 per gallon, and cheapest in the Gulf Coast region, averaging $2.764 per gallon.

One of the key factors underpinning the high price of gasoline is the cost of crude oil, which has been elevated by strong demand and geopolitical uncertainties.

Crude-oil futures settled Monday at $72.60 on the New York Mercantile Exchange. Gasoline futures closed at $2.1642 per gallon.

In London, Brent North Sea crude for July delivery advanced by 34 cents to 71.37 dollars a barrel.

Iran's Supreme Leader Ayatollah Ali Khamenei warned on Sunday that oil flow in the Gulf region, which supplies 20 percent of the world's oil, would be affected in its dispute with the West over its nuclear enrichment program.

The United States said on Monday that Iran should be given time to consider incentives from major powers in exchange for curbing its nuclear program.

European Union foreign policy chief Javier Solana is to deliver a package of incentives and disincentives to Iran this week in a bid to make a settlement of Iran's nuclear crisis.

Gunmen kidnapped eight foreign workers on an oil rig off the coast of Nigeria Thursday night, posing a new threat to the oil output of the west African country, the biggest oil exporter in the continent. However, armed militants on Sunday freed the eight workers after oil companies operating in Nigeria agreed to distribute more wealth to local communities.

"There will be some challenging months ahead on a total sales basis," Wagoner said as he updated investors on progress in GM's restructuring at the start of the company's annual shareholders' meeting.

Wagoner said a priority for GM management was "maximizing" the success of a buyout program offered to its unionized work force and closing the sale of a majority stake in its finance arm, GMAC.

In response to a question, Wagoner said GM remained in "active discussions" with former subsidiary Delphi Corp. and the unions who represent workers at the bankrupt auto parts supplier aimed at a negotiated settlement that would avoid a labor disruption.

"We believe we can do that, although it's going to take some time," he said. "One outcome will be a broader diversification in our supply base."

Wagoner, who first outlined GM's restructuring plans at last year's annual meeting, pointed to the progress the company has made in its turnaround efforts over the past 12 months.

GM, which lost $10.6 billion in 2005, is on track to cut $7 billion in structural costs in North America, Wagoner said, which should position the automaker for sustained profitability.

Meanwhile, GM's new vehicle launches, which only accounted for 20 percent of sales last year, are running at 30 percent this year and are on track to hit 40 percent next year, he said.

GM is closing 12 plants and slashing 30,000 jobs as it looks to cut costs and adjust to a slide in its share of the U.S. market, now just above 25 percent and down almost 8 percentage points over the past decade.

GM and other automakers have been hurt by rising prices for oil, steel, aluminum and resins.

NO PLANS TO DROP BRANDS

Wagoner told shareholders GM had no plans to drop any of its brands, despite suggestions that its eight nameplates are not sufficiently differentiated for car buyers.

Wagoner was responding to a question about whether management and GM director Jerry York had come to an agreement on the company's branding strategy.

York, who represents billionaire investor Kirk Kerkorian and his nearly 10-percent stake in GM, had called on GM to sell off its Saab and Hummer nameplates in January before he joined the company's board of directors.

GM stockholders will vote on Tuesday on several proposals being watched as indicators of the degree of investor anger.

Influential proxy advisory firm Institutional Shareholder Services has endorsed proposals that would weaken Wagoner's influence and could open the way for an overhaul of the board.

ISS said it supports four shareholder proposals opposed by GM's board.

The proposals would split the positions of chairman and CEO, recoup executive bonuses awarded when results are later restated, establish cumulative voting for board seats, and require a majority vote total to elect directors.

GM also faces accounting and labor issues. The company was forced to restate five years of earnings and is under investigation by securities regulators for its accounting practices.

GM and its major union, the United Auto Workers, also begin contract talks next year that are seen as crucial to the automaker's success in reducing its labor costs.

Allstate unit Allstate Insurance Co. has not written new earthquake coverage since March 6 and said on Friday that existing earthquake policies would not be renewed, The Associated Press said in a story published by The Wall Street Journal.

The Allstate unit has declined to renew storm coverage in parts of Florida and New York, and has taken a hard look at coastal coverage from Texas to Florida, beginning in 1992, the report said.

Four states -- Kentucky, Connecticut, Rhode Island and Florida -- require insurers to offer earthquake coverage, but Allstate is in talks with regulators in those states, the report said.

Allstate will continue to renew earthquake coverage in New Hampshire, New York and Pennsylvania, the report said.

Allstate could not be immediately reached for comment.