Bernanke: With unemployment high, Fed can do more

Mark Zandi, chief economist at Moody's Analytics, is among those who think the Fed will extend its timetable for record-low rates into 2015 at the September policy meeting. And unless the economy improves, Zandi expects the Fed to launch another round of bond purchases after the election.

Bernanke's comments Friday made clear that the economy has a long way back to full health.

"Unless the economy begins to grow more quickly than it has recently, the unemployment rate is likely to remain far above levels consistent with maximum employment for some time," he said.

At the end of every August, economists and central bankers convene in the Rocky Mountains at a symposium organized by the Federal Reserve Bank of Kansas City. They present papers and argue about economic issues. But mostly, they wait to see what the Fed chairman has to say.

In August 2010, Bernanke hinted during his remarks at Jackson Hole that the Fed might begin a second round of bond purchases, a policy called quantitative easing, or QE2. The Fed started buying bonds three months later.

Many analysts think a third round of bond purchases — QE3 — would include both Treasurys and mortgage-backed securities.