Posted by Christine/MN on 7/11/13 10:35am
Msg #476326
Maybe Interest Rates Will Settle Down
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July 10, 2013, 6:08 p.m. EDT
Bernanke stresses rates to stay low for long time
By Greg Robb, MarketWatch
WASHINGTON (MarketWatch) — The Federal Reserve will not be in a hurry to raise short-term interest rates, even after the unemployment rate comes down markedly, Chairman Ben Bernanke said Wednesday.
The Fed has set an unemployment rate threshold of 6.5% for the first rate hike from the current near-zero levels that have been in place since December 2008. The central bank has gone to great pains to stress that this tool is separate from the bond-buying program. The jobless rate was 7.6% in June.
Bernanke said the central bank will be in no rush to hike rates once the threshold is reached.
“There will not be an automatic increase in interest rate when unemployment hits 6.5%,” Bernanke said in the question-and-answer session of a speech to economists.
Ben S. Bernanke, chairman of the U.S. Federal Reserve, in June Given the weakness of the labor market, and low inflation “it may be well sometime after we hit 6.5% before rates reach any significant level,” Bernanke added.
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