Bernanke Warns again about the Risk of Spending Cuts

Federal Reserve Chairman Ben Bernanke on Wednesday repeated testimony to Congress, defending the central bank’s monetary easing and warning Congress against letting looming spending cuts take place.

“Given the still-moderate underlying pace of economic growth, this additional near-term burden on the recovery is significant,” Bernanke told the House Financial Services Committee.

In testimony Tuesday, Bernanke strongly defended the Fed’s easy monetary policy and said there was little risk of a spike in inflation in the near term.

In criticizing the central bank’s easy monetary policy, Sen. Bob Corker, a Republican from Tennessee, called Bernanke the biggest monetary dove since World War II.

Bernanke was quick to push back. “You called me a dove, well maybe in some respects I am, but on the other hand my inflation record is the best of any Federal Reserve chairman in the postwar period – or at least one of the best,” he said, citing the 2 percent average inflation rate.

via CNBC

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