FEDERAL Reserve chairman Ben Bernanke yesterday shrugged off inflationary concerns in the US, warning against a premature reversal of the Fed’s ultra-dovish monetary policies.
Bernanke said he was confident that America would avoid a double dip recession, but signalled that the Fed’s accommodative stance is here to stay for a while yet.
Responding to concerns that loose policy erodes savings, Bernanke said: “If we raise rates prematurely and cause the economy to go into recession, that is not going to be the environment where people can make a good return on their retirement funds or other investments.”
*Meanwhile, economic growth in the US cooled in June and early July and hiring grew at a tepid pace, the Federal Reserve said yesterday in its latest “Beige Book” summary of national activity.
The tone of the report was more downbeat than June’s assessment.