(MENAFN- AFP) Janet Yellen, the White House nominee to lead the Federal Reserve, said Thursday the central bank will do whatever is in its power to back a robust US economic recovery.
"I consider it imperative to do what we can to promote a very strong recovery," she told a Senate panel hearing on her nomination.
Yellen, currently Fed vice chair, stressed that the Fed's stimulus operations, especially its $85 billion a month asset-purchase program to hold interest rates down, "cannot continue forever."
But in the absence of inflation pressures and with the country still facing high unemployment and weak economic growth, she said, Fed policymakers "have the will and commitment" to strengthen growth and the jobs market.
Yellen told the Senate Banking Committee that unemployment at 7.3 percent remains too high and reflects an economy running "far short"of its potential.
In addition, she noted, long-term unemployment levels, and part-time employment, are at "unprecedented levels" and reflect a still-weak jobs sector.
"We have made good progress, but we have farther to go to regain the ground lost in the crisis and the recession," she said.
"Unemployment is down from a peak of 10 percent, but at 7.3 percent in October, it is still too high, reflecting a labor market and economy performing far short of their potential."
Yellen, 67, was questioned closely on her views ahead of a committee vote on her nomination by President Barack Obama to succeed outgoing Fed chairman Ben Bernanke, a close ally.
The Democrat-dominated committee was widely expected to approve her nomination, which will then have to be voted by the full Senate.
But Republicans on the committee also showed little hostility to her, even as they raised questions about the risks to the economy of the Fed's ongoing stimulus operations.
Yellen stressed that the Fed was keeping a close eye on the impact of the easy-money stance and takes the potential risks "very seriously".
"This program cannot continue forever. There are costs and risks associated with the program," she said.
Yellen also defended Bernanke's response to the economic crisis of 2008, which she said could have been "far worse" without his stewardship.
"Under the wise and skillful leadership of Chairman Bernanke, the Fed helped stabilize the financial system, arrest the steep fall in the economy, and restart growth."
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