Bernanke is testifying before the House Budget Committee a week after the Fed signaled that a full recovery could take at least three more years. As a result, the Fed said it doesn’t plan to raise its benchmark interest rate from a record low before late 2014 at the earliest.
The Fed chief is appearing two days after the Congressional Budget Office estimated that the deficit will top $1 trillion for a fourth straight year and could stay around that level for years.
Republicans have been critical of the Fed’s efforts to support the economy. Many have argued that keeping rates too low for too long could escalate inflation. And they’ve stressed that cutting government spending and lowering taxes are necessary to boost growth.
The hearing is sure to be contentious, and the toughest questions could come from Chairman Paul Ryan, a Republican from Wisconsin.
