Ben Bernanke Projects Unemployment Will Remain High into 2015

Recently, Federal Reserve Chairman Ben Bernanke gave a press conference and discussed recent changes in the state of economic growth and unemployment. He addressed several concerns as well as noting specifics that the Federal Reserve will be keeping an eye on for the next couple of years. Bernanke talked about the increase in gas prices and what he projects unemployment will look like in the year 2015.

Washington, D.C. – April 2, 2013 – Recently, Federal Reserve Chairman Ben Bernanke gave a press conference to address some of the concerns and observations his committee has about the economic state of United States. Among other things, he stated that unemployment rates would remain high until the year 2015 and that the gas price increase will be temporary. The goal of the committee will be to keep short-term interest rates lower until that time. After the end of 2015, Bernanke says interest rates will be reexamined and his hope is that unemployment will continue to decrease.

According to Bernanke, since the Fed’s meeting in January the belief that a pause in the economy’s recovery would only be temporary seems to have been proven true. Within the past six months there has been a growth in private payroll and a downturn in the unemployment rate. The amount of unemployment insurance filings has been down as well. That being said, Bernanke stated that the unemployment rate remains high at 7.7 percent. The committee was concerned with the increase in gas prices, which Bernanke believes is due to several refineries being shut down for maintenance. He believes these high gas prices are temporary. Another concern mentioned by Bernanke was that new restrictive fiscal policies would cause slow economic growth and a slowdown in job creation. He says the Fed will be keeping that under watch as well.

Bernanke concluded that while the economy is getting better, it is doing so slowly. Without taking the rising gas prices into consideration, inflation remains at a steady two percent overall. The high unemployment rate underscores the need for an improvement in the economy, says Bernanke. He predicts the unemployment rate will decrease only a little by 2015 if the country continues at the rate it is going. Economic growth will be at 2.3—2.8 at the end of the fourth quarter of 2013 and from 2.9 to 3.7 by the fourth quarter of 2015. This is not defined by Bernanke as considerable growth. The unemployment rate will go from between 7.3 to 7.5 in the fourth quarter of 2013 to the lower 6.0 to 6.5 in the fourth quarter of 2015.