Fed in favour of extending tax cuts
Federal Reserve chairman Ben Bernanke said extending the tax cuts passed during former President George W Bush's administration would help strengthen a US economy still in need of stimulus.
"In the short term I believe that we ought to maintain a reasonable degree of fiscal support, stimulus for the economy," Bernanke said yesterday before the House Financial Services Committee.
Bernanke aims to bolster the faltering economic recovery, while urging lawmakers to reduce federal budget deficits in the medium term, which he defined as 2013 to 2020.
While Democrats and Republicans alike want to keep the 2001 and 2003 tax reductions for families earning up to $250,000 (€194,000), President Obama and congressional Democrats want to end the break for those who earn more.