U.S. President George W. Bush has “total confidence” in Federal Reserve (Fed) Chairman Ben Bernanke, a top White House advisor said Thursday, adding that the new Fed chief will not allow inflation to rise. “Inflation is a concern to all of us,” White House economic advisor Allan Hubbard told CNBC financial news television. “But we're very, very confident, the president is very, very confident in Ben Bernanke and the members of the Federal Reserve board. They have made it very clear they are going to be very hawkish in keeping inflation under control. They are also going to make certain that the economy is going to grow.” “There is no question that Bernanke is not going to allow inflation to increase,” said Hubbard, the director of the National Economic Council. The U.S. central bank has raised U.S. interest rates 16 consecutive times, increasing a key borrowing rate to 5 percent, in an effort to contain inflation. But sparked by surprisingly high readings on core prices—which exclude volatile energy and food costs—financial markets have been concerned about the inflation outlook and are uncertain whether the Fed has done enough. Hubbard refused to say whether higher interest rates are needed to fight inflation. “The Fed knows what's best for the economy, and the president has total confidence in Ben Bernanke and the Fed,” he said. Hubbard said the Bush administration is pleased about the condition of the economy and called a government report released earlier on Thursday that showed the U.S. economy grew at a 5.3 percent annual rate in the first quarter “very significant.” He also said a low level of new jobless claims “suggest[s] that the unemployment rate is going to continue to decline.”
