“Federal Reserve Chairman Ben S. Bernanke has something to tout before Congress in hearings this week: job growth in the auto and housing industries.
Consumers rely on loans to buy cars and homes, so these segments of the economy are among the most responsive to Bernanke’s strategy of holding interest rates low and pressing on with bond purchases of $85 billion a month.
“The rate-sensitive sectors, most notably housing and autos, are kicking into a higher gear,” said Mark Zandi, chief economist for Moody’s Analytics Inc. in West Chester, Pennsylvania. “This reflects the Fed’s aggressive monetary policy and resulting rock-bottom interest rates,” along with “working off the excesses of the boom and bubble.”
Bernanke and his colleagues on the Federal Open Market Committee have pledged to continue buying bonds until the labor market improves “substantially.” Climbing employment in construction and vehicle manufacturing bolsters the case that asset purchases can help spur the improvement….”
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