Bernanke says restoring liquidity helped

ATLANTA, May 13 (UPI) -- U.S. Federal Reserve Chairman Ben Bernanke said Tuesday the central bank's efforts to add liquidity to financial markets appear to have made an impact.

"To date, our liquidity measures appear to have contributed to some improvements," Bernanke said via satellite at the Atlanta Fed Financial Markets Conference, in Sea Island, Ga.

Bernanke pointed out a series of steps the Fed took to restore liquidity, including raising limits at 28-day securities auctions and at the Fed's Term Auction Facility, the bank's discount window.

Bernanke also pointed to the bank's move to supply term funding, secured by $30 billion in illiquid assets, which allowed investment bank Bear Stearns to avoid bankruptcy in mid-March.

Bernanke pointed to dropping spreads between conforming fixed rates mortgage rates and Treasury rates as a "welcome sign" of improved financial liquidity.

"Corporate debt spreads have also declined somewhat from recent highs," Bernanke said.