Despite consumer spending currently holding up "better than expected", consumers still face a number of economic obstacles, according to the chairman and member of the Board of Governors of the Federal Reserve System.

In a speech on the economic outlook at the International Monetary Conference in Barcelona, Dr Ben S. Bernanke claimed American citizens are still having to deal with an economic climate that includes falling house prices and higher energy costs.

A softer job market and tighter credit conditions are also affecting consumers, the chairman stated, which could lead to them needing short-term loans to see them through times of financial difficulty.

On the topic of real estate, Dr Bernanke said: "Residential construction continues to contract and the overhang of unsold new homes remains large, although it has declined some in absolute terms."

Dr Bernanke was sworn in as chairman of board on February 1st 2006. He also serves as chairman of the Federal Open Market committee.

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