Newly appointed Federal Reserve Chairman Ben Bernanke said today that low inflation was the key to central banking success, making a deliberate bid to counter fears he may be soft on price pressures.
"Achieving price stability is not only important in itself, it is also central to attaining the Federal Reserve's other mandate objectives of maximum sustainable employment and moderate long-term interest rates," he told the House of Representatives Committee on Financial Services.
Mr Bernanke took the helm of the US central bank from Alan Greenspan on February 1 stand was delivering his first semi-annual testimony to lawmakers as chairman.
Financial markets have not forgotten remarks he made about dumping money into the economy by "helicopter" to defeat deflation - a small but serious risk the Fed had then identified as the country pulled out of recession.
But Mr Bernanke also took trouble to explain that the Fed could not afford to be narrow-minded and would continue with the risk-management style of his predecessor.
"Monetary policymakers must therefore strike a difficult balance - conducting rigorous analysis informed by sound economic theory and empirical methods, while keeping an open mind about the many factors, including myriad global influences, at play in a modern economy like that of the United States," he said.
Critics of central bankers who pay too much attention to inflation say that this is at the cost of growth and jobs.
In sum, Mr Bernanke pledged to follow in the footsteps of the Greenspan Fed. "My intention is to maintain continuity with this and the other practices of the Federsal Reserve in the Greenspan era. I believe that, with this approach, the Federal Reserve will continue to contribute to the sound performance of the U.S. economy in the years to come."