|Head of the US Federal Reserve Ben Bernanke has dimmed the prospect of tighter monetary policy in coming months as he warned that the world's biggest economy remains far from satisfactory.
Mr Bernanke, who has ushered in an era of record low interest rates and aggressive quantitative easing at the US Federal Reserve in a bid to spur growth, said on Monday that the economy still has far to go to recover to an acceptable state of health.
"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, in a speech addressing a conference on financial stability.
His comments reiterated the central banker's unswaying pessimism about the US economy in the face of recent economic indicators suggesting that the economy is picking up the pace.
Since December - when Mr Bernanke vowed to hold interest rates near zero until unemployment fell below 6.5pc - the central bank has stuck to ultra-low rates and its $85bn (£55bn) per month bond purchase programme, also known as quantitative easing.
US unemployment is currently at a four-year low of 7.6pc and has been falling since January. Consumer spending rose in February as the wage boost from rising job numbers more than offset tax rises. The US economy's fourth quarter growth rose at a 0.4pc annual rate, an upward revision on a preliminary 0.1pc estimate.
However, there are still indications that economic recovery remains fragile. On Friday the US Labour Department reported that just 88,000 new jobs were created in March, well below the level needed just to keep the current jobless rate steady, let alone lower it.
Automatic spending cuts, known in the US as sequestration, and tax rises introduced this year also cast a shadow over tentative recovery in the economic giant.
Despite some discussion at the policy-setting panel's January meeting that the QE programme is increasingly risky for monetary management, Mr Bernanke said most members had agreed that the bond purchases "continue to provide meaningful support to economic growth and job creation."
Some senior Fed members have voiced worries that, with the benchmark interest rate at 0-0.25pc for over four years, and with other major central banks around the world pumping liquidity into their economies, that the risk of an uncontrolled burst of inflation is growing.
"Most of the world's major industrial economies are engaged in expansionary monetary policy and on net I think that's mutually constructive," said Mr Bernanke.
"It's very, very important that we act to address unemployment."
Despite gloom over the wider economy, Mr Bernanke applauded a "greatly improved" banking sector, which he said had benefited from the Fed's periodic stress tests.
"The resilience of the US banking system has greatly improved since then , and the more intensive use and greater sophistication of supervisory stress testing, as well as supervisors' increased emphasis on the effectiveness of banks' own capital planning processes, deserve some credit for that improvement," he said.
Meanwhile US Treasury Secretary Jack Lew issued a thinly veiled prod to Germany to boost its domestic consumption for the sake of its struggling eurozone peers on Tuesday.
"The driver for economic growth has got to be consumer demand...policies to help to encourage consumer demand in countries that have the capacity would be helpful," he said following talks with Wolfgang Schaeuble, German finance minister.
Mr Lew, who said the US has "an immense stake" in the health of the eurozone economy, has been travelling around Europe urging top leaders to ease austerity measures in favour of growth-friendly policies, and press ahead with banking union in the single currency bloc.
On Tuesday he also met with his French counterpart Pierre Moscovici, where he reiterated his call for "a balanced approach between growth and fiscal consolidation."