Bernanke smoothly delivered the Fed’s latest statement on monetary policy and forecast a “moderate” pace to the economic recovery—with no market-shaking moments in the hour-long session.

“I liked the questions,” said William Larkin, portfolio manager at Cabot Money Management in Salem. “I think it was well-executed. It’s a good format.”

Bernanke said the Fed will keep its key interest rate at a record low for an “extended period”—elaborating to reporters that the phrase “suggests that there would be a couple of [Fed] meetings before action” to tighten monetary policy.

The Fed meets every six weeks to set the course for the nation’s economy. Higher interest rates would help curb spending and ease the price increases that have sparked criticism of the Fed’s decisions.

Bernanke reiterated the Fed’s stance that inflation will be “transitory,” but he acknowledged that “higher gas prices are absolutely creating a great deal of financial hardship for a lot of people.”

He also defended the Fed’s $600- billion bond-buying program aimed at lowering loan rates and boosting spending. Critics say the program has fueled inflation.

“We were very clear that this was not going to be a panacea, that it was only going to turn the economy in the right direction,” he said.

The bond purchases will end in June, but Bernanke declined to specify when the Fed will stop reinvesting the proceeds, a move that would likely drive up home and consumer loan rates.

(Boston Herald)