CAMBRIDGE, Mass., June 4 (UPI) -- U.S. Federal Reserve Chairman Ben Bernanke said Wednesday the link between rising oil prices and inflation had weakened in the past 40 years.
A unit of energy now produces almost twice the output it did in the 1970s, he said.
"This improvement in energy efficiency is one of the reasons why a given increase in crude oil prices does less damage to the U.S. economy today than it did in the 1970s," Bernanke told students at Harvard University's Class Day in Cambridge, Mass..
But, he said, the Fed would closely monitor inflation, especially as it relates to wages.
If prices and wages stay in check, "inflation created by a shock to oil prices will tend to fade relatively quickly," he said.
Bernanke made his remarks at his Alma mater, where civil-rights activist and social critic Dick Gregory was the speaker at his Class Day event in 1975.
In following in Gregory's foot steps, Bernanke was apologetic.
"Central bankers don't do satire as a rule," he said, "so I am going to have to strive for kind of interesting."