Washington Daybook: Federal Reserve to the Rescue?

Photograph by Tim Boyle/Bloomberg

A monitor displays Ben S. Bernanke while a trader works near the two-year and five-year U.S. Treasury Note options pit.

The focus in Washington turns today to the Federal Reserve and what tools the U.S. central bank may have left in its arsenal to boost the flagging economy.

Federal Reserve Chairman Ben S. Bernanke testifies before Joint Economic Committee on the economic outlook two weeks before the Federal Open Market Committee weighs the effectiveness of fed monetary easing thus far in reducing unemployment and spurring economic growth.

Meanwhile, the fed’s Board of Governors holds a public hearing on proposals for strengthening bank capital standards, including international rules known as Basel III. The stricter standards, mandated under the Dodd-Frank Act financial regulation overhaul, are aimed at averting bank failures and taxpayer-funded bailouts similar to those stemming from 2008 financial crisis.

On the campaign trail, President Obama is to hold a fifth California fundraiser today, a breakfast at the home of real estate developer Charles Quarles, before heading to the University of Nevada in Las Vegas to talk about extending a freeze on student-loan interest rates. Obama leads Mitt Romney 48 percent to 36 percent in Pennsylvania, a Franklin and Marshall College poll shows. Obama and the Democratic Party raised a combined $60 million in May for his re-election bid, AP reported.

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