WASHINGTON -- Federal Reserve Chairman Alan Greenspan told Congress Thursday that the Fed is prepared to raise interest rates if inflation does not fall further.

As the balance sheets of household and corporations continue to improve, he said, real short-term rates must rise in order to maintain balanced long-term growth. And in the absence of lower inflation, that will mean higher nominal short-term rates, he said.

Limited Time Offer

Save $400 off your subscription. Special offer ends April 30, 2017.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.