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Ben Bernanke suggests steady course on economy

Unemployment is still a gray area, Fed chief says

 Federal Reserve chairman Ben S. Bernanke told the Joint Economic Committee that the economy seemed as if it would continue growing at a moderate pace, and indicted the central bank wouldn’t take further action unless matters worsened.

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Federal Reserve chairman Ben S. Bernanke told the Joint Economic Committee that the economy seemed as if it would continue growing at a moderate pace, and indicted the central bank wouldn’t take further action unless matters worsened.

WASHINGTON — The Federal Reserve chairman, Ben S. Bernanke, said Thursday that the Fed was assessing whether the economy would continue to grow fast enough to reduce the high unemployment rate without additional action by the central bank.

But he gave no indication that the Fed had decided to take such action.

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Bernanke and other Fed officials have made clear in public appearances this week that they are troubled by the recent decline in reported job growth, the escalating crisis in Europe and the chaotic state of domestic fiscal policy.

But Bernanke told a congressional committee Thursday that the Fed had not yet concluded that growth was slowing, nor that new measures to stimulate the economy were warranted. The Fed’s policy-making committee meets in two weeks.

“Economic growth appears poised to continue at a moderate pace over coming quarters, supported in part by accommodative monetary policy,’’ Bernanke told the Joint Economic Committee, an assessment that on its surface was little changed from his last public remarks on the state of the economy in late April.

Beneath the surface of that forecast, however, Bernanke said the Fed was confused. The government estimated that employers added only 69,000 jobs in May, a marked slowdown from the reported pace earlier in the year. But other economic indicators show a relatively steady, if lackluster, expansion.

Bernanke said the decline in job growth could be a quirk in the data, or it could be a warning sign. And if hiring actually is slowing, he said, ‘‘more rapid gains in economic activity will be required to achieve significant further improvement.’’

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That could well serve as the justification for a new round of stimulus.

“That’s the essential decision,’’ Bernanke said. ‘‘Will there be enough growth going forward to make material progress on the unemployment rate?’’

The Fed chairman said its existing efforts to support the economy remained necessary. The central bank has held short-term interest rates near zero since late 2008, and it has said that it plans to maintain that policy until late 2014 at least. It also has purchased more than $2 trillion in Treasury securities and mortgage securities to further reduce borrowing costs for businesses and consumers.

He also offered the standard affirmation that the Fed ‘‘remains prepared to take action as needed to protect the US financial system and economy.’’ He noted that the risk of a European crisis, in particular, had intensified in recent weeks.

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