WASHINGTON — Federal Reserve Chairman Ben Bernanke warned U.S. lawmakers Thursday that they would deliver a “self-inflicted” wound to the nation‘s economy by holding up efforts to raise the government's borrowing limit.
The Fed chief also said the central bank had no immediate plans to introduce new stimulus measures, elaborating on remarks he made a day earlier that the Fed stood ready to take additional steps to boost the economy if conditions worsened.
His comments ended an early-morning rally on Wall Street. Traders had interpreted Wednesday’s comments to mean the Fed was about to embark on another round of bond purchases, analysts said.
The government hit its $14.3 trillion borrowing limit in May. Republicans have held up increasing the limit because of concerns that excessive government spending has widened the federal deficits. The Treasury Department said it will default on its debt if the limit is not raised by Aug. 2.