Warren Buffett said yesterday the US economy is gradually improving, helped by the efforts of Federal Reserve chairman Ben Bernanke to stimulate it.

Speaking on CNBC television, Buffett said the economy is benefiting from improvement in areas that had not previously performed well, particularly homebuilding.

He also said the improved economy is helping create increased traffic for NetJets, Berkshire’s private plane unit. “The economy is moving forward, but at a slow pace,” he said. “Demand has come back, but slowly.”

Buffett said low benchmark interest rates, including overnight rates that have been effectively zero since late 2008, can help stimulate demand.

“When interest rates are low, and people expect them to stay low for a while, it pushes up the value of all other assets,” he said. “Interest rates act like gravity for all other asset prices.”

Buffett called Bernanke “a gutsy guy” who has “done very, very well in terms of what he has done for the US.”

Last week, the Fed said it will continue to buy $85 billion of bonds per month to keep interest rates low and spur growth, and said it will step up purchases if needed.

The economy grew at a 2.5 per cent annualised rate in the first quarter.

Buffett spoke on CNBC after Berkshire’s annual shareholders meeting over the weekend in Omaha, Nebraska.