Tagged: Federal Reserve

Federal Reserve Chairman Ben Bernanke said the Fed is ready to implement "balance sheet actions if necessary."

That means if the Federal Open Market Committee feels that the economic recovery is in danger, it is ready to implement a third round of quantitative easing, or bond purchases intended to bring down long-term interest rates and spur borrowing and spending.

"If appropriate... we remain entirely prepared to take additional action," the chairman said. "We will not hesitate to use them."

Policymakers at the Federal Reserve wrap up a two-day meeting Wednesday and will explain what they plan to do about interest rates. The consensus seems to be they'll keep short-term rates near zero to help support the lagging economy.

The news that consumer prices rose a relatively modest 0.3 percent in March from February supports "the view the U.S. Federal Reserve has room to provide more support for the economy if needed," Reuters concludes. It adds that: