The chairman of the US Federal Reserve Bank says he is monitoring risks to the economy and is prepared to take action if necessary.
Ben Bernanke is giving testimony to the US Congress, something which is being closely watched by investors who are looking for signs that monetary policy will be loosened.
But the chairman said aspects of the US economy were holding up.
He gave few hints of any change to policy soon. Mr Bernanke warned that international pressures, such as the eurozone crisis, posed risks for the US economy but said otherwise the US economy would continue to grow at a modest pace.
He said inflation was likely to stay at or slightly below the 2% target set by the Federal Reserve.
On Wednesday, the Fed's Beige Book, which takes survey evidence from businesses across the country, concluded that overall economic activity had quickened in the period between early April to late May.
There have been worries about the US economy running out of steam after a key jobs report last week showed fewer people than expected joined the workforce.
Mr Bernanke did warn that government tax policy posed a threat, pointing to so-called "fiscal cliff" legislation that could force a steep cut in government spending alongside higher taxes, a move some economists say could send the country back to recession.
He said: "The so-called fiscal cliff would, if allowed to occur, pose a significant threat to the recovery."
bbc.co.uk
Ben Bernanke is giving testimony to the US Congress, something which is being closely watched by investors who are looking for signs that monetary policy will be loosened.
But the chairman said aspects of the US economy were holding up.
He gave few hints of any change to policy soon. Mr Bernanke warned that international pressures, such as the eurozone crisis, posed risks for the US economy but said otherwise the US economy would continue to grow at a modest pace.
He said inflation was likely to stay at or slightly below the 2% target set by the Federal Reserve.
On Wednesday, the Fed's Beige Book, which takes survey evidence from businesses across the country, concluded that overall economic activity had quickened in the period between early April to late May.
There have been worries about the US economy running out of steam after a key jobs report last week showed fewer people than expected joined the workforce.
Mr Bernanke did warn that government tax policy posed a threat, pointing to so-called "fiscal cliff" legislation that could force a steep cut in government spending alongside higher taxes, a move some economists say could send the country back to recession.
He said: "The so-called fiscal cliff would, if allowed to occur, pose a significant threat to the recovery."
bbc.co.uk
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