The Federal Reserve chairman Ben Bernanke says the US economic recovery will bounce back in the coming months. Mr Bernanke told reporters that growth had been slower than expected this year but said force would build in the second half of the year. He did not suggest the central bank was planning any further fiscal easing. The latest economic news from the US showed employment growth slowed sharply in May.
Shareholders had been expecting 150,000 new jobs to have been created last month, instead growth was just a third of that number. The jobs report was the latest of a string of weak economic releases. Bernanke said the main reasons hindering growth were outside, such as high energy prices and the Japan crises and that the impact of these problems should move away to allow steady expansion before the end of the year.
Bernanke said: “Overall, the economic recovery appears to be continuing at a reasonable pace, even though at a rate that is both uneven across sectors and exasperatingly slow from the standpoint of millions of unemployed and underemployed workers.”
Some shareholders had been hoping there would be a hint that the Federal Reserve might consider taking further steps to pump money into the economy. Its $600bn Treasury bond-buying agenda which was intended to help keep interest rates low and money curving is ending this month. He mentioned that the economy still needed the revenue of low interest rates.