Become our Friends on
Home » , , » Fed Chief: Rates to Stay Low

Fed Chief: Rates to Stay Low

Written By Trading Forex News on Wednesday, February 24, 2010 | 8:44 AM


NEW YORK--Federal Reserve Chairman Ben Bernanke told Congress on Wednesday that a weak job market and low inflation would likely allow the central bank to keep interest rates at very low levels for a long time.

In his first appearance before Congress following a testy confirmation vote in the Senate last month, Bernanke offered a relatively somber assessment of the U.S. economy despite recent signs of strong growth.

The country has lost 8.4 million jobs since the start of the economic downturn, the deepest since the Great Depression. The Fed chief said job losses were abating, but also acknowledged the recession's toll on American workers.

"Notwithstanding the positive signs, the job market remains quite weak," Bernanke said in prepared testimony to the U.S. House of Representatives Financial Services Committee.

Bernanke told lawmakers that he stood prepared to continue supporting the economy with extraordinary stimulus for some time, but also argued the Fed possesses a broad array of tools to remove such accommodation when the time is right.

"The Federal Reserve will at some point need to begin to tighten monetary conditions," Bernanke said.

Among the Fed's options, he said, are reserve-draining transactions with financial institutions. One such program, a "term deposit facility" that would give banks the incentive to park their money at the central bank, could be operational shortly after being tested this spring, the Fed said in its semiannual report to Congress.

Acknowledging congressional efforts to overhaul financial regulation in the wake of a severe crisis, Bernanke urged lawmakers to preserve the confidentiality of banks who borrow from the Fed's emergency discount window. However, he added that officials would support disclosing borrowing at other special lending facilities, with a lag.

He defended the central bank's role in bank supervision, which is under threat from key proposals in the Senate, saying information gleaned from overseeing banks was critical in helping guide its response to the crisis.

Reuters

Share this article :

Post a Comment

 
Support : Creating Website | Hang Moi Ve |
Copyright © 2009 - 2013. Bohuc.com - All Rights Reserved
Template Created by maskolis.com. Published by Bohuc
Proudly powered by Blogger