Housing Still a Drag: Fed Chief

Setbacks likely, says Bernanke, who offers no hints on interest rate status
By Peter Fearon,  Newser Staff
Posted Oct 16, 2007 5:38 AM CDT
Federal Reserve System Chairman Ben Bernanke addresses a dinner meeting of the Economic Club of New York Monday, Oct. 15, 2007 in New York. (AP Photo/Jason DeCrow)   (Associated Press)
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(Newser) – The real estate slump will continue to be a "significant drag" on US economic growth well into next year, said Federal Reserve Chairman Ben Bernanke in his first speech on the economy since August. Recovery from the credit crisis will take time, and setbacks are likely, Bernanke told the Economic Club of New York, Bloomberg reports.

Bernanke offered few clues about whether the Fed will lower interest rates again at their next meetings in two weeks. "He wasn't giving anything away," said an investment company executive. Bernanke would only say that the Fed "will continue to watch the situation closely and act as needed to foster sustainable economic growth and price stability."