Weak Jobs Report Puts Pressure on Bernanke

Fed now more likely to take action
By John Johnson,  Newser Staff
Posted Jul 7, 2012 11:28 AM CDT
Weak Jobs Report Puts Pressure on Bernanke
In this June 7, 2012, file photo, Federal Reserve Board Chairman Ben Bernanke testifies on Capitol Hill.   (AP Photo/J. Scott Applewhite, file)

Yesterday's tepid jobs report firms up evidence that the recovery is backsliding and increases the odds that the Federal Reserve will try to give it a jolt, reports the Wall Street Journal. The most likely move by Ben Bernanke would be to buy bonds—or quantitative easing, in econo-speak—with the intent to drive down interest rates, spur investment, and move investors into stocks.

The Journal provides a look into the Fed's "activist" and "hawk" camps, noting that Bernanke has tended to side with the activists of late, especially because hawks' fears of higher inflation haven't materialized. We may get the first hint of what, if anything, is to come when Bernanke testifies on Capitol Hill on July 17-18. The Fed's next policy meeting comes soon after, at the end of the month. (Read more recession stories.)

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