The nation’s high unemployment rate is a “grave concern” and the Federal Reserve will step in to help the economy if it doesn’t recover, Fed Chairman Ben Bernanke said Friday.
Speaking at the Fed's annual symposium for central bankers held in Jackson Hole, Wyoming, Bernanke said the U.S. economy faces “daunting” challenges and that progress in reducing unemployment has been too slow, but he did not commit the Fed to any specific plan to boost the economy, such as a round of bond purchases to lower long-term interest rates.
In his speech, the Fed chief hinted that the Fed could act to spur growth if needed, saying “the Federal Reserve will provide additional policy accommodation as needed to promote a stronger economic recovery and sustained improvement in labor market conditions in a context of price stability.”
World markets have been on edge for weeks waiting to hear what Bernanke will say in Wyoming.
Bernanke was expected to acknowledge the Fed is actively considering another round of monetary easing. By stopping short of signaling another bond-buying program is imminent, he was potentially disappointing the markets, analysts said.
“There might be optimism ... expecting some QE coming our way and obviously that's weakened the dollar,” Fabian Eliasson, vice president of currency sales at Mizuho Corporate Bank in New York, said ahead of Bernanke’s speech. “It seems that the market is hoping for that.”