Ben Bernanke signaled tonight that the Fed is ready to cut interest rates again to help the struggling economy, the Wall Street Journal reports. The Fed chief said the nation's housing troubles and its offshoots are straining the economy and financial markets and will "create some headwinds for the consumer in the months ahead." The Fed meets again Dec. 11.
"I expect household income and spending to continue to grow," Bernanke said, but he warned of "the combination of higher gas prices, the weak housing market, tighter credit conditions, and declines in stock prices." Another Fed official made similar remarks yesterday, leading many to speculate that the Fed will cut the current 4.5% rate by at least a quarter point.