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Bernanke: Crisis in Europe weighing on consumer confidence

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The Federal Reserve "remains prepared to take action as needed" to protect the U.S. economy from the fallout of the European debt crisis, Fed Chairman Ben Bernanke told lawmakers in Washington, D.C., today, but surveys show consumer sentiment may be keeping would-be homebuyers on the fence."The crisis in Europe has affected the U.S. economy by acting as a drag on our exports, weighing on business and consumer confidence, and pressuring U.S. financial markets and institutions," Bernanke said.To encourage borrowing that can spur economic growth, Bernanke said the Fed has continued to keep pressure on long-term interest rates, including mortgages.One way it's doing that is by reinvesting principal the Fed receives from its holdings of Fannie Mae and Freddie Mac debt and mortgage-backed securities (MBS) back into agency MBS, and rolling over its maturing Treasury holdings at auction.But the depressed housing market continues to be another "important drag" on t...