Business Highlights

Bernanke: Too early to declare lasting recovery


The Fed chief's speech to the Economic Club of Washington made clear he thinks the economy will struggle even as it recovers from the recession. He said the economy confronts "formidable headwinds" - including a weak job market, cautious consumers and tight credit.

The central bank has leeway to keep rates low because inflation is under control and is expected to stay tame because of the economy's weakness. Some private forecasters even fear that the recovery could fizzle late next year as the government stimulus fades.


Early stock gains from Bernanke comments evaporate

NEW YORK (AP) - Even the prospect of interest rates staying low couldn't keep buyers in the stock market.


Bernanke's remarks sent the dollar down because low rates make a currency less attractive, and that gave stocks a boost since a lower dollar can add to profits for U.S. companies that do business overseas. The market's gains evaporated later, however, as the dollar pared its losses.

Many traders have closed their books on the year and are wondering whether incremental improvements in the economy will be able to support more stock market gains next year.


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