Fed Will Help If Economy Craters: Bernanke

The Federal Reserve is prepared to take further steps to lift the economy if it weakens, Ben Bernanke said today—but he didn't signal any imminent action in testimony before a congressional panel. Bernanke said the European debt crisis poses significant risks to US financial markets. He noted that US unemployment remains high and the outlook for inflation subdued.

"As always, the Federal Reserve remains prepared to take action as needed to protect the US financial system and economy in the event that financial stresses escalate," Bernanke told the Joint Economic Committee. Most economists don't expect further moves at the Fed's next policy meeting June 19-20, despite some signals from other Fed members in recent days. They note that long-term interest rates have already touched record lows. Even if rates decline further, analysts say they might have little effect on the economy. Today's testimony didn't "tip Bernanke's hand" as to his plans, analysts say. (More Ben Bernanke stories.)