NEW YORK ( TheStreet) -- Federal Reserve Chairman Ben Bernanke stuck to his view that economic growth will pick up going into 2012, even as the central bank took down its projections of just how much growth can be expected over the next two years. The Fed now sees an increase in gross domestic product growth of 2.7% to 2.9% for 2011 vs. an April forecast for growth of between 3.1% and 3.3%. Expectations for 2012 GDP growth were also cut, to a range of 3.3% to 3.7% from a previous range of 3.5% to 4.2%. Additionally, the central bank said it's anticipating higher core inflation in 2011, raising its expectations to growth of 1.5% to 1.8%, from 1.3% to 1.6%, previously. Employment, meanwhile, isn't forecast to improve as much as the Fed had thought in April. Unemployment in 2011 is now expected to come in between 8.6% and 8.9%, compared with its prior forecast for unemployment of between 8.4% and 8.7%. In his second press conference following the Federal Open Market Committee's latest rate decision announcement , Bernanke was resolute in his determination to avoid specifics. Although questions from the press largely centered on timing and targets, the Fed Chairman emphasized that the central bank has the necessary tools at its disposal and is ready to act, but is currently in monitoring mode. When one reporter tried to nail down a timeframe for the "extended period" language, Bernanke indicated it meant at least two to three meetings from taking action, but stressed that the point of the phrase is to convey that the Fed isn't certain how much time will be needed before it can begin unwinding accommodative monetary policy. The first question of the conference addressed plans for the Fed's securities holdings but Bernanke sidestepped the request for a timeline, saying that the Fed hasn't made any commitments yet. He added that choosing not to reinvest their holdings would be the initial steps of an exit strategy. Bernanke acknowledged that some longer-term economic issues such as weakness in the financial sector and problems in the housing market could be contributing to the recent slowdown but repeated his expectations that transitory factors are also at play, adding that growth is expected to pick up once those factors dissipate. While Bernanke didn't completely eliminate the possibility of more quantitative easing, he emphasized the differences between the economic conditions that warranted QE2 and the current situation where inflation is more of a concern than deflation. Regarding the European sovereign debt crisis, Bernanke said he believes European leaders appreciate the gravity of the situation and said the Fed is keeping a close eye on Europe while making sure that their own institutions are well-positioned. Bernanke added that U.S. banks don't appear to be directly exposed to the crisis. Stocks were slipping in recent trades. The Dow Jones Industrial Average was down by 32 points, or 0.3%, at 12,158. The S&P 500 was lower by 3 points, or 0.2%, at 1292, and the Nasdaq Composite was off by 7 points, or 0.3%, at 2680. The U.S. dollar was trading higher against a basket of currencies with the dollar index showing the greenback up by 0.2%. The benchmark 10-year Treasury fell 2/32, lifting the yield to 2.994%. -- Written by Melinda Peer in New York.