Bernanke says economy needs more time to heal

Reuters

WASHINGTON (Reuters) - The U.S. economy is not fully recovered from its deep recession with housing still weighing on growth, Federal Reserve Chairman Ben Bernanke said on Friday in a speech on the importance of community development.

"Our economy is far from where we would like it to be," he said in remarks prepared for delivery to a conference.

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The Fed earlier this week said it will see its $600 billion bond buying program, launched in November to spur a sluggish recovery, through to its planned conclusion at the end of June.

The world's largest economy grew at a sluggish 1.8 percent annualized rate in the first three months of the year, but unemployment is still at a lofty 8.8 percent.

The depressed housing market is holding back the economic recovery, Bernanke said. Home foreclosure rates remain high and many families find themselves owing more for their homes than the homes are worth.

"Obviously, the problems in the labor market and the housing market are not unrelated," he said.

(Reporting by Mark Felsenthal; Editing by Andrea Ricci)