Econintersect: Fed Chairman Bernanke’s first Fed press conference ever offered little additional insight beyond past Fed statements, Congressional testimony, and meeting minutes. Noteworthy was Bernanke confirming a strong US Dollar policy, early release of monetary projections, and uncertainty effecting economic projections.
Bernanke’s performance was equal to a master politician – in control of his facts with most of the answers broad brush responses offering little additional insight.
The table below of central economic projections was released during the press conference (notice the lowering of GDP and the increase in inflation forecasts for 2011):
The international uncertainty in these projections were detailed:
- Middle East and North Africa unrest
- Growth in emerging markets
- Europe debt
In addition, Bernanke in response to questions said he expected only a moderate and temporary effect coming from the destruction in Japan.
Bernanke confirmed a strong US Dollar policy which is supported by maintaining low inflation and supporting a strong economy. Further he saw no real negative economic effect precipitated by the ending of QE2 which he added would end without tapering.
While the Bernanke press conference was underway, the markets and precious metals rose – buyers obviously saw positive metrics in the Fed actions today. The rise cames in the face of a significant reduction in GDP estimates for 2011 and out years.
source: Federal Reserve
