Markets and businesses anticipated that Federal Reserve Chairman Ben Bernanke would illuminate near-term plans for stimulus at his appearance before Congress this week to present the Semiannual Monetary Policy report. However, the chairman largely avoided endorsing or denouncing further stimulus actions instead focusing on decelerating economic activity and the usual side-stepping of partisan-laced, election-year questioning on Capitol Hill.
Bernanke brought the bad news early, as he told members of the Senate Banking Committee of an economy that, while continuing to grow, has seen the pace of advancement shrink and signs that recent employment gains were on a precarious limb, so to speak—particularly in manufacturing.
And though he reiterated the target for the federal funds rate would remain at the historically low level (between 0% and ¼%) for the foreseeable future and that the Federal Open Market Committee was “prepared” to take further actions if needed, Bernanke gave no indication which way the Fed was leaning on the latter matter.
-Brian Shappell, CBA, NACM staff writer