August 7, 2022

Fed Chairman Sticks With His View of a Slowly Mending Economy

Mr. Bernanke also said that he continued to see no evidence of broad and enduring inflation despite recent increases in the prices of oil and other commodities.

“Over all, the economic recovery appears to be continuing at a moderate pace, albeit at a rate that is both uneven across sectors and frustratingly slow from the perspective of millions of unemployed and underemployed workers,” Mr. Bernanke said in remarks that he planned to deliver Tuesday afternoon to a gathering of bankers in Atlanta.

His speech followed related remarks by President Obama, who told reporters that he was worried about the pace of growth, but saw no possibility of another recession.

“I am concerned about the fact that the recovery that we’re on is not producing jobs as fast as I want it to happen,” Mr. Obama said.

Mr. Bernanke’s speech, which came just before the financial markets closed for the day, was awaited by investors looking for any indication that the Fed might consider additional steps to enhance growth. The Fed chairman alluded to that possibility only once, noting that “monetary policy cannot be a panacea.”

Stocks quickly headed lower after he spoke, after spending most of the day in positive territory. The Dow Jones industrial average, which had been up more than 70 points, closed the day down 19.15 points at 12,070.81.

Mr. Bernanke spent more time explaining why the central bank planned to continue its existing programs despite concerns about inflation.

The economy has expanded much more slowly this year than the Fed predicted. Last month, private employers added only 83,000 jobs, reducing the average so far this year to about 180,000 jobs a month — barely enough to maintain the current rate of unemployment.

“Until we see a sustained period of stronger job creation, we cannot consider the recovery to be truly established,” Mr. Bernanke said.

Article source: http://www.nytimes.com/2011/06/08/business/economy/08fed.html?partner=rss&emc=rss

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