Fed Interest Rate Policy Won't Change Soon

New York, NY, Nov. 17, 2009--The Federal Reserve isn't likely to boost interest rates for quite some time, according to Chairman Ben S. Bernanke.

Bernanke said that the weak U.S. economy and high unemployment picture will probably extend the Fed's period of low borrowing costs.

The Fed chief wants to “keep the liquidity spigot wide open for some time to come,” said Stephen Stanley, chief economist at RBS Capital Markets in Stamford, Connecticut.

The labor market is an “area of great concern,” Bernanke told financial executives in Manhattan at a luncheon hosted by the Economic Club of New York.

“Jobs are likely to remain scarce for some time, keeping households cautious about spending,” he said. While payrolls will increase as the economy recovers, unemployment “likely will decline only slowly if economic growth remains moderate, as I expect.”