WASHINGTON, April 15, 2010 (AFP) – Federal Reserve chief Ben Bernanke warned on Wednesday the US economy will recover at a “moderate” pace and that significant time will be needed to claw back jobs lost in the recession.
In cautious remarks that belied Wall Street’s gathering optimism, Bernanke cautioned that the US economy continued to face strong headwinds as it attempts to pull out of the worst recession in a generation.
“If the pace of recovery is moderate, as I expect, a significant amount of time will be required to restore the 8.5 million jobs that were lost during the past two years,” he told lawmakers.
But eyeing the end of massive government stimulus spending, the Fed chairman said the economy should be able to stand on its own feet, even if a tough slog still lies ahead.
Economic demand, he said, would be enough to “promote a moderate economic recovery in coming quarters.”
That was considerably less bullish a view than that held by Wall Street investors, who are pushing stock markets to levels not seen since the depths of the economic crisis.
Buoyed by news that Americans may be returning to their high-spending ways, the Standard & Poor’s index of 500 leading companies rallied to