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Archive Bank Officials' Comments

January 11 (Fed Chairman Bernanke) -- Dovish Statement by Fed Chairman.

Fed Chairman Bernanke said "additional policy easing may well be necessary" to offset "downside risks" to the U.S. expansion. "In light of recent changes in the outlook for and the risk to growth" the Federal Open Market Committee may be required to lower interest rates further. "We stand ready to take substantive additional action as needed to support growth and to provide adequate insurance against downside risks.

The speech points to signs that the FOMC may lower rates by 50 basis points in its next meeting if data continues to point to a possible recession in the United States. His comments caused the dollar to extend losses against the Euro, and for the day the Dollar had its biggest decline in 2 months.

November 29 (Fed Chairman Bernanke) -- Get Ready for a Rate Cut

Bernanke's statement made way for a rate cut as he cited revived financial turmoil in the last couple of months. Consumer spending is expected to remain strong for now, although tighter credit conditions and deepening housing slump will put on the stress. He stated "these developments have resulted in a further tightening in financial conditions, which has the potential to impose additional restraint on activity in housing markets and in other credit-sensitive sectors".

A rate cut is warranted to bolster the economy. After Donald Kohn stated this inclination to cut rates on Wednesday, stocks soared as Dow Jones industrial average gained more than 300 points. After Bernanke backed up the intention, the DJI has gained more than 50 points by 11:30AM EST.

November 08 (Fed Chairman Bernanke) -- Fed Chairman Bernanke spoke in front of Congress (Joint Economic Committee) about the economic outlook in Washington DC.

Bernanke cited risks of the ailing dollar, specifically in fueling inflation. He also warned of a more drastic and noticeable slowdown in the economy, in the coming m months, although it is resilient. He gave dovish undertone, as he expects the economy to recover next year, reducing the possibility to cut rates in December.

Regarding the housing sector, he predicted a rise of delinquencies in subprime ARM will cause an increase in foreclosures as "a sizable number of recent-vintage subprime loans experience their first interest rate resets."