Mr Bernanke said that the rapid growth of developing economies was behind the increase in food prices, rather than the Fed’s decision to embark on a second, $600bn (£371bn) round of printing money. “Clearly what’s happening is not a dollar effect, it’s a growth effect,” Mr Bernanke said in a rare question and answer session with journalists at the National Press Club in Washington on Thursday.
The United Nations Food and Agriculture Organization (UN FAO) has warned that high prices, already above levels in 2008 which sparked riots, were likely to rise further.
Surging food prices have come back into the spotlight after they helped fuel protests that toppled Tunisia's president in January. Food inflation has also been among the root causes of protests in Egypt and Jordan, raising speculation other nations in the region would hoard grain stocks to reassure their populations.
"The new figures clearly show that the upward pressure on world food prices is not abating." But America's latest dose of quantitative easing has drawn heavy criticism from overseas that it will only stoke an inflationary problem that many developing economies are having to tackle.
Imo, it doesn't really matter what Ben says if the starving masses perceive us as the problem. They've tagged their economies to the dollar and it's worth less now, that's a fact that can't be "spun" when it comes to one's stomach.
Add to that the growing perception that we're not good for our debt.
“I would very much urge Congress not to focus on the debt limit as the bargaining chip in this situation,” Mr Bernanke said. “We need to be very careful not to create any impression that the US won’t pay its creditors.”