US economy has far to go to recover: Bernanke

Chairman of the US Federal Reserve Ben Bernanke has insisted that the American economy is a million miles away from an acceptable and desired state of recovery.

“Today the economy is significantly stronger than it was four years ago, although conditions are clearly still far from where we would all like them to be,” he said on Monday.

Bernanke also said that the US central bank’s tactics would force financial institutions and banks in the country to restrain their own internal risk-management systems.

His comments came as some critics and economists have voiced doubts about the Federal Reserve’s preparedness to tighten the screws on its easy-money policy, and hold long-term interest rates down.

Bernanke stated that American banks have managed to uplift their balance sheets by means of more capital attraction. Nevertheless, a large number of firms still depend on short-term sources of financial support.

“In the area of liquidity and funding, continued improvement is still needed on some dimensions,” he said.

“Notably, supervisors will continue to press banks to reduce further their dependence on wholesale funding, which proved highly unreliable during the crisis,” Bernanke pointed out.

On April 5, the US Labor Department announced that only 88,000 new jobs were created last month.

The figure is the slowest in a period of nine months, and well below the level needed just to keep the current 7.6 percent jobless rate steady.