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Fiscal gridlock means extra reliance on quantitative easing to boost the economy.
Despite the fiscal gridlock in Washington, major stock indexes are holding on to gains for the year.
Asked whether fiscal gridlock had forced the Fed to act, he said, "We're going to worry about what we can worry about, which is monetary policy".
Continued "fiscal gridlock" — an inability to reach agreement on how to handle the impending expiration of the Bush-era tax cuts — would put pressure on the Fed to act, Mr. Berner added.
ROME — With political turmoil still plaguing Greece and descending upon the much larger economy of Italy on Monday, the fate of the euro and market stability worldwide hinged on whether two of Europe's most tangled and unresponsive political cultures could deal with their tightening fiscal gridlock.
If that pessimistic view proves correct, the two parties will have to fall back again on temporary measures and gimmicks to avert total fiscal gridlock and the risks of further economic and financial damage to the country – exactly the sequence of events that put them where they are today.
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"The report may stoke concern that India's outlook has worsened because of trade and fiscal deficits, political gridlock, inflation and the threat to global growth from the European debt crisis," Bloomberg News reports.
Political gridlock over fiscal policy didn't push the economy off a cliff.
These included the recent gridlock over fiscal policy in United States, the euro area sovereign debt crisis, continued bank balance sheet problems, slowing trade flows and concerns about whether the existing economic policy tools can offset any further weakness.
— Federal Reserve officials and economists appear increasingly united in their view that the partisan gridlock on fiscal policy in Washington has clouded the prospects for a faster and stronger recovery.
Gridlock over fiscal policy in Washington has most likely added pressure on the Fed to use monetary policy to support the economy, though Fed officials have not publicly said that.
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