What it means: Fed Chairman Ben Bernanke’s upbeat assessment of the economy is consistent with recent observations by the Fed. With the economy stabilizing, the Fed has felt free to take small steps toward pulling back some emergency programs intended to strengthen the financial system and the economy.
What’s next for the economy? Tough challenges still lie ahead, Bernanke said. Strains in markets worldwide persist. Banks will face further losses on bad investments. And credit could remain tight.