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Fed's Bernanke sees 'moderate' economic recovery
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Fed's Bernanke sees 'moderate' economic recovery
AFP - Thursday, April 15
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US Federal Reserve Chairman Ben Bernanke testifies before a House Financial Services Committee meeting in Washington, DC, last month. Bernanke has told US lawmakers they faced "difficult choices" in cutting the country's deficit and that action cannot be delayed.
WASHINGTON (AFP) - – Federal Reserve chief Ben Bernanke Wednesday warned the pace of the US recovery would not be quick and that "significant" time would be needed to claw back jobs lost in the recession.
"If the pace of recovery is moderate, as I expect, a significant amount of time will be required to restore the 8.5 million jobs that were lost during the past two years," he told lawmakers.
The Fed chair said data suggested demand would be enough to "promote a moderate economic recovery in coming quarters," as the US continues its tough slog out of recession.
He pointed to improved consumer spending -- traditionally a strong driver of the US economy -- as one factor aiding the recovery.
"Going forward, consumer spending should be aided by a gradual pickup in jobs and earnings, the recovery in household wealth from recent lows, and some improvement in credit availability."
But he warned the economy continued to face strong headwinds.
"I am particularly concerned about the fact that, in March, 44 percent of the unemployed had been without a job for six months or more."
Echoing recent comments that the world's largest economy must act swiftly to curb its soaring budget deficits, Bernanke took his tough message straight to Congress.
He warned lawmakers they faced "difficult choices" in cutting the country's deficit and that action cannot be delayed.
"Addressing the country's fiscal problems will require difficult choices, but postponing them will only make them more difficult," he told lawmakers.
The Fed chair warned "the poor fiscal condition of many state and local governments" remained a restraint on the pace of economic recovery.
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