Fed Panel Split Over Bernanke's Low Rates Policy

It's the most a chairman has faced in 19 years
By Mark Russell,  Newser Staff
Posted Aug 11, 2011 8:14 AM CDT
Federal Reserve Board Chairman Ben Bernanke testifies before the Senate Banking, Housing and Urban Affairs Committee on the first anniversary of the Dodd-Frank Act, on Capitol Hill in Washington, Thursday,...   (AP Photo/J. Scott Applewhite)

(Newser) – Ben Bernanke's Tuesday announcement that the Fed is prepared to keep short-term interest rates close to zero for at least two more years is facing internal revolt from the Federal Open Market Committee, the 12-member committee of Fed presidents and governors that sets monetary policy, reports the Wall Street Journal. Bernanke is facing three dissenting opinions for the first time in his five-and-a-half-year tenure—the most dissents issued by FOMC in 19 years.

While the dissenters remain effusive in their support of Bernanke—one called him an "outstanding chairman"—they objected to his specifying two more years of ultra-low short-term interest rates, and preferred Bernanke not specify a timeframe. Analysts suspect Bernanke's announcement represents a compromise, with other members of FOMC pushing for a third round of quantitative easing.

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