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Wednesday, January 25, 2012

Bernanke Press Conference

In his press conference, following today's FOMC statement, Chairman Bernanke addressed the Fed Funds forecasts introduced with today's statement. Bernanke stressed that the forecast is no more than a forecast, based on the information currently available, and subject to change with economic data.



In response to a question regarding the prospects for another round of quantitative easing, Chairman Bernanke indicated that QE3 is "certainty on the table," should economic conditions deteriorate. He warned that it was too early to make a decision either way.

Many of Bernanke's comments were designed to anchor expectations of future inflation. He noted the continuity of the FOMC board, even given different chairmen. He also stressed that even though the forecasts are subject to change, he sees little possibility of inflation forcing policy action any time soon.

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