Fed Chair calls out Congress for fiscal policy frustrating recovery

FED Chair Ben Bernanke is widely believed to be stepping down at the end of his second term in January. Today he appeared before Congress to give his last biannual update on the economy to the House Financial Services Committee, reaffirming the Fed’s monetary policies but warning that federal fiscal policy remains the single largest obstacle to revitalized growth.

He noted that federal spending cuts of the kind supported by the GOP are reducing growth this year by about 1.5 percentage points.

“The risks remain that tight federal fiscal policy will restrain economic growth over the next few quarters by more than we currently expect, or that the debate concerning other fiscal policy issues, such as the status of the debt ceiling, will evolve in a way that could hamper the recovery.”

Read his remarks to Congress here.