MercoPress. South Atlantic News Agency

Federal Reserve working to “help ensure that the US dollar is strong”

Ben Bernanke promised to monitor “the dollar developments closely”

United States Federal Reserve chief Ben Bernanke said Monday that US policymakers are mindful of the sliding US dollar. Bernanke said he is “attentive” to the decline in the currency and is working to “help ensure that the dollar is strong”.

But he also signalled that interest rates will be kept at a record low, a factor in the dollar's steep drop.

The US currency has dropped 13% against the pound and 6.4% versus the Euro so far this year.

The comments are unusual, as the Fed rarely talks about the value of the US dollar.

“We are attentive to the implications of changes in the value of the dollar,” Mr Bernanke said, adding that the US central bank will continue to “monitor these developments closely”.

Bernanke is trying to bolster confidence in the dollar without actually raising rates, as that might hurt the nascent recovery.

The US economy came out of recession in the July-to-September quarter, its first period of growth since the second quarter of 2008. Some economists are worried that the dollar may go into freefall if the Fed does not intervene in some form.