Ahead of releasing the Fed's Beige Book, the Federal Reserve Chairman Ben Bernanke, testified before the House Budget Committee about the U.S. economy, where he ensured that the central bank will take Necessary steps to aid economic recovery.
Bernanke ensured that European debt problems will not affect the U.S. economy, due to the stability of U.S. markets, adding that the U.S. economy might be able to expand during this year and the upcoming year, but nevertheless, the economy will continue to suffer from elevated unemployment Over Time, where the labor sector will witness a Slow Reduction in unemployment over the upcoming period.
Bernanke also assured investors that inflation is likely to remain subdued, while consumer spending is most likely to accelerate in time, but over a moderate pace, therefore, the recovery process will encounter Significant Restraints over the upcoming period due to elevated unemployment and tight credit conditions, which the bank see as Restraining commercial real estates, and accordingly, the housing activity is firmed with only a mile changes on a year-to-year basis.
Moreover, the Fed's chairman noted that inflation expectations over the long-term remains stable, while global investors sought Treasuries as a safe haven over the past period, finally, Bernanke noted that U.S. fiscal position Deteriorated during the credit crunch, but overall, the budget seems on Unsustainable Path.
The Fed will release its Beige Book report at 14:00 EST, on Wednesday