Here’s what’s important in the business world this morning:
Bernanke: Chairman Ben Bernanke says the Federal Reserve is prepared to take further steps if the U.S. economy weakens, but he didn't signal any action is imminent.
Bernanke says the European debt crisis poses significant risks to the U.S. financial markets. And he noted that U.S. unemployment remains high and the outlook for inflation subdued.
Bernanke's comments in testimony to a congressional panel came one day after three Fed officials suggested that the central bank may need to do more to help the economy.
Most economists don't expect further moves at the Fed's next policy meeting June 19-20. They note that long-term rates have already touched record lows. Even if rates did decline further, analysts say they might have little effect on the economy.
Unemployment: The number of people applying for U.S. unemployment benefits fell last week for the first time in five weeks.
The Labor Department said Thursday that applications for weekly benefits dropped by 12,000 to a seasonally adjusted 377,000. That's down from an upwardly revised 389,000 the previous week.
The four-week average, a less volatile measure, rose by 1,750 to 377,500, the highest level in a month.
Oil: Oil is climbing after China's central bank cut its interest rates to give a boost to its slowing economy.
Benchmark crude rose $1.72, or 2 percent, to $86.74 per barrel in New York. Brent crude gained $1.49 to $102.17 per barrel in London.
The Chinese central back is cutting its benchmark interest rate to try to increase economic growth. China imports large amounts of oil, so the move may help increase demand for oil and other energy products.
At the pump, the national average for a gallon of gasoline fell a half cent overnight to $3.56.
China: China cut its benchmark lending rate Thursday for the first time in nearly four years, adding to efforts to reverse a sharp economic downturn.
The interest rate on a one-year loan will be cut by a quarter percentage point to 6.31 percent effective Friday, the central bank announced. It was the first rate cut since November 2008.
Beijing has rolled out a series of measures to stimulate the economy after growth fell to a nearly three-year low of 8.1 percent in the first quarter and April factory output grew at its slowest rate since the 2008 crisis. Private sector analysts expect this quarter's growth to fall further.
"The changes indicate mounting concern in Beijing over slowdown of growth," said Credit Agricole CIB economist Dariusz Kowalczyk in a report.
"We expect a boost to demand for lending as a result of the cuts, although the actual impact will be limited given low demand for credit."
The government has said it will pump billions of dollars into the economy through spending on building low-cost housing, airports and other public works. It also has approved a wave of major investments by state companies.
The Associated Press contributed to this report.