Bernanke says another stimulus plan may be warranted

U.S. Federal Reserve Chairman Ben Bernanke told Congress on Monday that another wave of government spending may be needed as the economy limps through what could be an extended period of subpar growth.

"With the economy likely to be weak for several quarters, and with some risk of a protracted slowdown, consideration of a fiscal package by the Congress at this juncture seems appropriate," Bernanke said in prepared remarks for delivery to a congressional panel.

It was the first time that Bernanke had explicitly endorsed a second stimulus package. The government sent out about $100 billion in checks over the summer to try to jump-start the economy, but consumer spending has struggled since then. Retail sales fell for three consecutive months through September.

Bernanke, who is testifying before the U.S. House of Representatives Committee on the Budget, said Congress should consider including measures to improve access to credit, but did not specify what form they ought to take.

He said there were some encouraging signs that steps taken so far to unfreeze credit markets were helping, but it was too soon to assess their full effects.

"The stabilization of the financial system, though an essential first step, will not quickly eliminate the challenges still faced by the broader economy," he said.