JACKSON HOLE, Wyo. — The Federal Reserve chairman, Ben S. Bernanke, delivered a detailed and forceful argument on Friday for new steps to stimulate the economy, reinforcing earlier indications that the Fed is on the verge of action.
Calling the persistently high rate of unemployment a "grave concern," language that several experts described as unusually strong, Mr. Bernanke made clear that a recent run of tepid rather than terrible economic data had not altered the Fed's will to act, because the pace of growth remained too slow to reduce the number of people who lack jobs.
The federal government said on Wednesday that the economy expanded at an annual rate of 1.7 percent in the second quarter, slightly higher than its initial estimate of 1.5 percent but lackluster in normal times. A measure of consumer confidence hit a three-month high on Friday, but that, too, was impressive only in comparison with the immediate past. The government will release a preliminary estimate of August job growth next week; it is expected to show that the unemployment rate remains above 8 percent.
Mr. Bernanke said that the Fed's efforts over the last several years had helped to hasten economic recovery, that there was a clear need for additional action and that the likely benefits of new steps to stimulate growth outweighed the potential costs.
"It is important to achieve further progress, particularly in the labor market," Mr. Bernanke said. "Taking due account of the uncertainties and limits of its policy tools, the Federal Reserve will provide additional policy accommodation as needed to promote a stronger economic recovery and sustained improvement in labor market conditions in a context of price stability."
In setting the stage for action when the Fed's policy-making committee meets in two weeks, Mr. Bernanke appeared to defy political pressure from Republicans to refrain from new measures. Mitt Romney, the Republican presidential nominee, has said such action would be counterproductive, and has pledged to replace Mr. Bernanke at the earliest opportunity.
"Policies from Congress, not more short-term stimulus from the Fed, are the ingredients necessary for restoring growth in the American economy," Senator Bob Corker, Republican of Tennessee, said in a statement after Mr. Bernanke's speech.
On the other hand, Democrats welcomed Mr. Bernanke's remarks. There is little prospect that Fed action will lift the economy before the election, but party officials fear the opposite possibility — that inaction could undermine economic confidence — and so they greeted the speech with relief.
Senator Charles E. Schumer, Democrat of New York, said Mr. Bernanke "should not let any political backlash deter him from following through and doing the right thing."
Mr. Bernanke did not announce any new steps in his speech, delivered here before an annual monetary policy conference organized by the Federal Reserve Bank of Kansas City. Nor did he indicate which steps were most likely, a reticence that reflects his desire not to give details ahead of the Federal Open Market Committee, which convenes in two weeks.
Some analysts expect the Fed to announce a new round of asset purchases after that meeting, further expanding its holdings of Treasury securities and mortgage-backed securities to reduce borrowing costs and spur investment. Others expect that it will instead announce its intent to keep its benchmark interest rate near zero beyond its current forecast of late 2014.
Jan Hatzius, chief United States economist at Goldman Sachs, said he was now convinced that the Fed would extend its forecast, because Mr. Bernanke described benefits but not costs of that approach. He said he also expected the Fed to announce new asset purchases, but not necessarily in September. The speech, he said, made the Fed's intentions clear, "but it still doesn't really tell you the timing."
Stocks fell slightly after the release of Mr. Bernanke's remarks, then climbed again. Commodities like gold and oil also increased.
Mr. Bernanke devoted much of his speech to asset purchases. He said past rounds of purchases had produced "economically meaningful" benefits, contributing to lower borrowing costs for corporations and a general rise in stock prices. He cited one study that found that the combined effect of the Fed's three rounds of asset purchases raised output by 3 percent and increased employment by two million jobs.
He provided a shorter description of the benefits of policy forecasts.
In both cases, after reviewing the costs of existing actions and the potential consequences of doing more, Mr. Bernanke rendered a clear verdict on the balance.
"The costs of nontraditional policies, when considered carefully, appear manageable, implying that we should not rule out further use of such policies if economic conditions warrant," he told the audience of central bankers, fiscal policy makers and academic economists gathered at the Jackson Lake Lodge in the middle of Grand Teton National Park for the annual policy conference.
The Fed has sent signals in recent months that it is preparing to take new action to stimulate the economy. Its policy-making committee said after its most recent meeting in early August that it would "provide additional accommodation as needed."
Since that meeting, the depressed housing market has shown signs of modest revival. But worries about fiscal policy have intensified, and Europe remains on a low boil. Mr. Bernanke's verdict on Friday was unambiguous: "The economic situation obviously is far from satisfactory," he said. And his description of the high unemployment rate as a "grave concern" drew particular notice from his well-versed audience.
"It goes well beyond normal central bank expressions of the need to bring unemployment down," said Alan S. Blinder, an economics professor at Princeton University and a former Fed vice chairman. "It is an interesting question for someone to research if any central banker has ever made a statement that strong" about unemployment.
In addition to asset purchases and forward guidance, the account of the most recent meeting mentioned two other options. The Fed could lower the interest rate it pays banks on reserves kept at the Fed, which might push some money into circulation. It could also seek to provide low-cost financing for certain kinds of lending, like mortgage loans, emulating a program recently begun by the Bank of England.
Several Fed officials have said they would like to replace the time horizon for current policy with a trigger tied to economic data, declaring, for example, that the Fed is likely to keep interest rates near zero until the unemployment rate falls below a specified level, or until economic output exceeds a certain threshold.
The internal debate underscored a striking contrast with Mr. Bernanke's speech at this same conference in 2010, when he gave the first indication that the Fed would embark on a second round of asset purchases.
Then, Mr. Bernanke devoted most of his remarks to establishing the need for action, largely taking for granted that the Fed had the power to improve the economy. On Friday, it was the need for action that Mr. Bernanke took for granted. The question now is how much more the Fed can do.