The US economy may not yet be out of the woods, Federal Reserve chairman Mr Alan Greenspan repeated today, again leaving the door open for further interest rate cuts by the central bank.
Mr Greenspan's testimony, prepared for delivery to the Senate Banking Committee, was the same as that given to the House Financial Services Committee last week.
In the testimony, he noted economic indicators had turned from persistently negative to more mixed, a positive development. But he warned there were still considerable risks the US economy may get worse before it gets better.
"The period of sub-par economic performance, however, is not yet over, and we are not free ofthe risk that economic weakness will be greater than currently anticipated, and require further policy response," Mr Greenspan repeated.
"That weakness could arise from softer demand abroad as well as from domestic developments," he said.
"But we need also to be aware that our front-loaded policy actions this year coupled with the tax cuts under way should be increasingly affecting economic activity as the year progresses."