WASHINGTON (AP) — U.S. inflation is unusually low, as a report Tuesday on consumer prices showed. Yet some Republicans say they fear the Federal Reserve's efforts to bolster the economy will eventually ignite inflation.
Sen. Jim DeMint told Chairman Ben Bernanke that the Fed's purchases of Treasury bonds to try to drive down long-term interest rates could be weakening the value of the dollar and raising inflation risks.
DeMint, a South Carolina Republican, said any short-term boost to the economy from lower rates might not be worth the risk of runaway price increases later.
Bernanke said he appreciated DeMint's concerns about inflation. But he insisted that the Fed is "comfortable that we have the tools to unwind these policies in a way that will not threaten inflation."