With the financial system awash in money and economic growth picking up, inflationary forces are possible. But with unemployment hovering near double digits, with Mr. Bernanke under attack for his performance in the runup to the crisis and with Congress moving to pare back the central bank’s powers, economic and political pressures are weighing against rapid interest rate increases.

How Mr. Bernanke manages the pivot to tighter policy will test his skills nearly as much as the near collapse of the banking system and the worst recession in generations.  More here.