The U.S. economy will continue growing slowly, and will not slip back into a recession according to Federal Reserve Board Chairman Ben Bernanke. On Monday, he was interviewed by ABC News. “My best guess is we’ll have a continued recovery [but] it won’t feel terrific,” he said. There have been fears of a double-dip recession in recent weeks as growth has remained very slow.
On Friday, the May employment report was released and showed 41,000 private-sector jobs were created last month, and is being seen as the latest signal that the U.S. economy may be softening again.
Coming into 2010, the big question was whether the economy would “get its own legs” and not have to rely on government fiscal medicine and inventory behavior, Bernanke said.
“So far the news is pretty good,” Bernanke said.
“We’ve seen consumer coming back. We’ve seen firms spending more. There are some signs the private sector is picking up the baton and moving the economy forward,” he said.
Bernanke quickly noted that there were “caveats” to this forecast. Growth was still not fast enough to bring down the high unemployment rate.
In addition, the U.S. banking sector was “not completely healthy,” he said. Banks were still deleveraging and not making as many loans as “we’d like to see,” Bernanke said.