RENEE MONTAGNE, host: And if you've traveled overseas, you might've felt the pain of the falling dollar. It buys less. If you import goods to the U.S., it means prices are higher and higher. Yesterday, the country's top central banker, Federal Reserve Chairman Ben Bernanke, expressed concern about the falling dollar, as NPR's Wendy Kaufman reports.</s>WENDY KAUFMAN: It's a delicate balance, lowering interest rates to give the economy a boost without fueling inflation. The current 2 percent interest rate set by the fed is the lowest in nearly four years, and low rates can contribute to a decline in the value of the dollar. That, in turn, can lead to higher prices for commodities and imported goods.</s>WENDY KAUFMAN: Speaking at a conference in Spain, Bernanke took the unusual step of publicly commenting on exchange rates.</s>Mr. BEN BERNANKE (Federal Reserve Chairman): We continue to carefully monitor developments in foreign exchange markets. The challenges that our economy has faced over the past year or so have generated some downward pressures in the foreign exchange value of the dollar which have contributed to the unwelcome rise in import prices and consumer price inflation.</s>WENDY KAUFMAN: Recent surveys suggest consumers expect inflation to rise significantly over the next year and beyond. Bernanke warns such expectations could become self-fulfilling. He said economic growth in the current quarter is likely to be relatively weak, but reiterated his hope that the economy would pick up in the second half of the year and into 2009.</s>WENDY KAUFMAN: Wendy Kaufman, NPR News.
As the U.S. dollar continues its slide against other currencies, inflation is making an unwelcome return. Federal Reserve Chairman Ben Bernanke this week spoke about what a weakening dollar could mean for the economy.