WASHINGTON (MNI) – The following is an excerpt from Federal Reserve
Chairman Ben Bernanke’s press conference Thursday.
QUESTION: Does that mean that your tolerance for inflation will be
higher in coming years? If not, what good is that language there?
Secondly, stock prices are up today as are prices of oil and gold. Why
aren’t those part of the reaction to the Fed’s acts today?
BERNANKE: Well our policy approach doesn’t involve intentionally
trying to raise inflation. That’s not the objective. The idea is to make
sure that we provide enough support that the economy will grow fast
enough to bring unemployment down over time. As we look back over the
last six months or so, we’ve seen unemployment at basically the same
place it was in January. We’ve seen not enough jobs growth to bring down
the unemployment rate and what we need to see is more progress. And
that’s what we are looking at. In terms of the mid 2015 date, we think
by that point the economy will be recovering, will be providing the
support it needs, but if you look at our projections you will see it
doesn’t involved any inflation. Inflation will still be close to out 2%
target.
If inflation goes above our target level, as we talked about our
statement in January, we take a balanced approach. We bring inflation
back to the target over time, But we do it in a way that takes into
account the deviations of both of objectives from their targets.
** MNI Washington Bureau: 202-371-2121 **
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