INSTANT VIEW: Bernanke: inflation outlook "highly uncertain"

NEW YORK (Reuters) - U.S. Federal Reserve Chairman Ben Bernanke on Friday called the U.S. inflation outlook "highly uncertain," and said central bank policy-makers would do what they must to preserve price stability.

KEY POINTS:

* Bernanke, speaking to a Kansas City Federal Reserve Bank conference in Jackson Hole, Wyoming, said declines in commodity prices and stability in the dollar are encouraging.

* Bernanke also said the year-old financial storm "has not yet subsided."

COMMENTS:

BRIAN DOLAN, CHIEF CURRENCY STRATEGIST, FOREX.COM, BEDMINSTER, NEW JERSEY:

"Bernanke's optimism is likely to be translated as ongoing dovishness. His expectations that inflation will ease again suggest no urgency to remove accommodation...(and this) plays into the notion that the Fed is on hold for the foreseeable future. His positive comments on the dollar aside, the interest rate implications of his remarks are dollar-negative."

JOSH STILES, SENIOR BOND STRATEGIST, IDEAGLOBAL, NEW YORK:

"The way Bernanke can try to uphold the Fed's inflation-fighting credentials while leaving real interest rates in negative territory when headline and core inflation are unacceptably high is to focus on his dovish outlook for inflation, saying that inflation is all going to go away. Bernanke has a generally benign outlook on inflation. He sees this current, unacceptably high inflation as temporary.

"We will get some relief on headline inflation because oil has come off, but that leaves open the question of how lasting that relief will be and what will happen to core inflation in the meantime. I think core inflation will go up. I'd like to see what Bernanke does if oil goes back to the highs as the economy slides."

KEVIN FLANAGAN, FIXED INCOME STRATEGIST, GLOBAL WEALTH MANAGEMENT, MORGAN STANLEY, PURCHASE, NEW YORK:

"The emphasis still is on the economic and market risks, but still trying to walk a fine line on inflation as well."

"There is nothing to suggest the Fed would do another easing."

"There will be no change in monetary policy for the foreseeable future. He is continuing to focus on the same themes that the Board has been focusing on."