The economy is likely to experience continued growth next year but there are some "important headwinds" that will "prevent the expansion from being as robust as we would hope," Federal Reserve Chairman Ben Bernanke said today.
In a speech to the Economic Club of New York Bernanke said constrained lending and sluggish job growth are sources of concern in the months ahead.
He said the Fed will continue to maintain programs that help improve the flow of credit and have been encouraging financial institutions to work with borrowers to restructure troubled commercial real estate loans in a "prudent manner."
Bernanke said job growth will remain sluggish and "the best thing we can say about the labor market right now is that it may be getting worse more slowly."
The slow job growth will cause consumer spending to remain sluggish and "the unemployment rate will decline only slowly if economic growth remains moderate, as I expect," he said.
