Federal Reserve Chairman Ben Bernanke: Economy Recovering Slowly
Unemployment to remain high, interest rates low, says Fed Chief
WASHINGTON, Feb. 24, 2010— -- High unemployment and low interest rates will continue as the country undergoes "a nascent economic recovery" from the worst downturn in generations, Federal Reserve Chairman Ben Bernanke said today in his semi-annual report to Congress.
Despite the progress, growing commercial real estate problems, soaring deficits, and mounting job losses pose a real threat to the future, he said.
Addressing the House Financial Services Committee Wednesday morning in Washington, Bernanke said government efforts to rescue the economy from a more severe crisis have helped arrest the decline and are leading toward recovery. To keep the recovery from stalling, Bernanke said the Fed's key interest rates would remain near historic lows for "an extended period."
As evidence of growth, Bernanke said the country's economy expanded at a 4 percent rate during the second half of last year. Once the government pulls back its rescue efforts, continued economic recovery will depend on the private sector, the Fed chief said.
But there are a slew of factors that could jeopardize economic growth, Bernanke cautioned, including the nation's skyrocketing debt.
"It is very very important for Congress and the administration to come up with some kind of program, some kind of plan, that will credibly show how the United States government is going to bring itself back to a sustainable position," Bernanke said.
"It's not something that's 10 years away because it affects the markets today," he cautioned. "And the longer you wait, the harder it's going to be."
High unemployment and low interest rates will continue as the country undergoes "a nascent economic recovery" from the worst downturn in generations, Federal Reserve Chairman Ben Bernanke said today in his semi-annual report to Congress.