The Dow Jones Industrial Average fell by 206.04 points to end at 15,112.18, while the S&P 500 lost 1.4 per cent to close at 1,628.93.
Bernanke insisted that any reduction in the scheme would be based on steady growth and better unemployment figures, meaning that the reduction in QE could come earlier or later if the economy improved or declined by more than expected.
Bernanke also clarified that tapering would not imply a tight monetary policy, but simply a slow reduction in the scale of the asset purchases. Currently, the Fed’s purchases stand at $85bn (£54.9bn) per month, which will remain at that level for now.
The Federal Open Market Committee (FOMC) left the federal funds rate at 0 to 0.25 per cent where it has been since December 2008. Of the 19 members, 15 suggested that rates would not rise until after 2014, and 10 members suggested no hike until after 2015.
The Fed also emphasised that while it will keep rates low until unemployment falls below 6.5 per cent, when unemployment falls it will only cause the Fed to consider raising rates, rather than act as an automatic trigger for a rise.
Bernanke declined to comment on whether he would continue as chairman of the Federal Reserve after his second term ends in January 2014.