By Nicole Bowling
Medill News Service
— Federal Reserve Chairman Ben Bernanke dampened concerns about inflation and expressed optimism about further improvements in employment during his first-ever press conference Wednesday.
Many factors contributing to the economic slowdown are “transitory,” Bernanke told reporters, echoing the Fed’s April statement released earlier in the day.
“While the recovery process looks likely to continue to be relatively moderate compared to the depth of the recession, I do think that the pace will pick up over time. And I am very confident that, in the long run, the U.S. will return to being the most productive, one of the fastest growing and dynamic economies in the world,” Bernanke said.
The Fed will maintain the target range for the federal funds rate at zero to 0.25 percent and will complete purchases of $600 billion in long-term Treasury securities by June, it stated in its press release.
Bernanke emphasized the Fed’s dual mandate to control inflation and encourage maximum employment when questioned about rising commodity prices and the Fed’s influence over the high unemployment rate.
Asked about the decision to hold a press conference, Bernanke said the Federal Reserve has been looking for ways to increase transparency and accountability for many years. Previously, a fear existed that the chairman speaking might create unnecessary volatility in financial markets.
“Many Americans have lost confidence in the Fed because of the recent financial crisis,” said Rebel Cole, professor of finance at DePaul University’s College of Commerce in Chicago. “The press conference was a way for the Fed to get people back in its corner.”