Fed chief warns low interest figures set to stay

Federal Reserve chairman Ben Bernanke told the US Congress yesterday that a weak job market and tame inflation warrant low interest rates for "an extended period", dampening speculation a policy tightening might be nearing.
By The Newsroom
Published 25th Feb 2010, 10:01 BST
Updated 25th Feb 2010, 10:01 BST

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

The country has lost 8.4 million jobs in a little more than two years in the most severe economic downturn since the Great Depression.

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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," Mr Bernanke told the US House of Representatives Financial Services Committee.

Bernanke said the US central bank's policy-setting Federal Open Market Committee was prepared to support the economy with extraordinary stimulus for some time.

"The FOMC continues to anticipate that economic conditions are likely to warrant exceptionally low levels of the federal funds rate for an extended period," he said, echoing the Fed's most recent policy statement in late January.