Bernanke sees gradual economic recovery - Pittsburgh Business Times:

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In testimony before the congressional Joint EconomicCommittew Tuesday, Bernanke also warned another jolt to the banking syste will stall any recovery. “We continue to expect economic activity tobottoj out, then to turn up later this Bernanke said. “Key elements of this forecasf are our assessments that the housinyg market is beginning to stabilizre and that the sharp inventory liquidation that has been in progress will slow over the next few The forecast assumes a continued gradual repair ofthe country’sd financial system, and a relapse there could causew a recovery to stall, he While a recovery is now expected to begin, the Fed’s forecast cautions that the rate of growth is likelyh to remain below its longer-ru n potential for awhile.
Businesses will likely put off meaning unemployment will remain high even after economixcgrowth resumes. Bernanke also believes inflation will remainn low for some A report Tuesday from the Institute for Supply Managementshowed U.S. servicee industries, which make up 90 percentt of the economy, contracted at the slowesgt pace in six monthsin April, seen as anothef sign the recession is nearing an end.