The US economy is picking up after its summer slowdown and has "regained some traction" during recent weeks, according to Federal Reserve chairman Alan Greenspan.

Speaking to the House of Representatives Budget Committee, the central bank chief said that business investment and manufacturing output continued to rise, although reports on retail sales in August were mixed.

He added that consumer spending and the creation of new jobs had gathered pace, and that the record rise in oil prices last month does not seem to have had a lasting impact on inflation.

The positive comments appear to match another report from the Federal Reserve, stating that the economy 'continued to expand' during July and August.

Meanwhile, the Fed's 'beige book', a monthly economic forecaster compiled by twelve regional banks, suggests a mixed picture of rising energy and raw material costs and a reduction in household spending in many parts of the nation.

And Greenspan's outlook was not all cheerful, either. He warned of the growing retirement burden, claiming that the US has "already made promises to coming generations of retirees that we will be unable to fulfill."

His words follow an announcement earlier this week from the Congressional Budget Office that the US budget deficit for the year ending September 30 will reach a record $422 billion (€346bn; £236.6bn).

Data sourced from: BBC Online Business News (UK); additional content by WARC staff