Bernanke says European debt crisis to have modest effect on U.S.

U.S. Federal Reserve Chairman Ben Bernanke said on Wednesday that his country's economic recovery will be on track and the European debt crisis is likely to have only a "modest" impact on the U.S.

"The recovery in economic activity that began in the second half of last year has continued at a moderate pace so far this year," Bernanke said in a testimony before the House Budget Committee.

"Moreover, the economy -- supported by stimulative monetary policy and the concerted efforts of policymakers to stabilize the financial system -- appears to be on track to continue to expand through this year and next," he said.

He believes that the recent fall in equity prices and weaker economic prospects in Europe "will leave some imprint on the U.S. economy," but he also argued that the decline in Treasury bonds' interest rates and reduced commodity prices could offset some of the pain.

"If markets continue to stabilize, then the effects of the crisis on economic growth in the United States seem likely to be modest," he told lawmakers.

Meanwhile, he vowed that the U.S. central bank "will remain highly attentive to developments abroad and to their potential effects on the U.S. economy."

Source:Xinhua