–Bloom Raskin: Should Work Twds Broad, Sustained Recovery, Biz Lending
–Diamond: Fed Will Have Major Work Implementing Fin Reform Legislation

WASHINGTON (MNI) – Two nominees to fill spots on the Federal
Reserve Board pledged Thursday to support the dual mandate of price
stability and full employment while working towards supporting the
economic recovery.

In statements prepared for delivery to the Senate Banking
Committee, Sarah Bloom Raskin and Peter Diamond each stressed the role
the Fed will play in ensuring continued growth, improved employment
prospects and a recovery in business lending.

“This is a challenging moment for the Federal Reserve,” Bloom
Raskin said, noting that “even though the worst of the crisis is over,
it remains a precarious time for far too many of our families and
businesses. The Fed must do its part to restore the underlying strength
and vibrancy of the American economy.”

Bloom Raskin, who served as Maryland’s Commissioner for Financial
Regulation over the last four years, said the Fed’s success in achieving
price stability “is critical to our economic strength, and it remains a
central institutional objective that I subscribe to wholeheartedly.”

But she said high unemployment has “pervasive social costs” that
also must be addressed.

“The Fed must work for a broad and sustained recovery that not only
controls inflation but facilitates growth and more robust business
lending by banks,” she said.

Diamond, an economics professor at the Massachusetts Institute of
Technology since 1966, said, “The experience of the recent financial
crisis and the financial reform legislation have underlined the multiple
jobs the Fed has in working to fulfill the dual mandate of high
employment and price stability. The Fed will have major work to do to
implement the tasks that the legislation is placing at the Fed.”

He noted that his specialty has been the study of how the economy
deals with risks, which “should be very helpful at the Federal Reserve
as part of the process of addressing our heightened awareness of the
dangers of systemic risks.”

San Francisco Federal Reserve Bank President Janet Yellen also
testified at the hearing on her nomination to serve as Fed vice chair.

** Market News International Washington Bureau: 202-371-2121 **

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