Corporate borrowers are selling bonds at the fastest pace ever, as evidence mounts that the U.S. economy is gaining strength and investors grow more confident that Europe is edging toward a solution to its sovereign crisis. Petroleo Brasileiro SA and AT&T Inc. led $137.8 billion of offerings this month through Feb. 8, the best start to a month on record, according to data compiled by Bloomberg.

Even so, many economists are waiting for more proof before raising their forecasts. The U.S. will grow just 2.2 percent this year, according to the median estimate of private economists surveyed by Bloomberg this month. They project unemployment will average 8.1 percent in the final quarter.

Bernanke and his fellow policy makers also are more guarded than analysts such as Paulsen. The central bankers foresee growth in 2012 of 2.2 percent to 2.7 percent, on a fourth- quarter-over-fourth-quarter basis, and an average jobless rate of 8.2 percent to 8.5 percent in the last three months of the year, according to the central tendency of their January forecasts.

Bernanke called the economic expansion "sluggish" in testimony last week before the Senate Budget Committee in Washington and told lawmakers the decline in the unemployment rate veils weaknesses in the labor market.

The Fed has pledged to keep short-term interest rates "exceptionally low" at least through late 2014, provided inflation remains subdued and unemployment stays high. It reduced its target for the federal funds rate that banks charge each other on overnight loans to a range of zero to 0.25 percent in December 2008 and has held it there ever since.

Joseph LaVorgna, chief U.S. economist for Deutsche Bank Securities in New York, said policy makers will have to raise rates sooner because the economy will expand faster and joblessness will fall further than they project. The first increase will come in the second half of 2013, after GDP grows 3 percent this year and unemployment drops to 7.8 percent by the end of 2012, he predicted.

'Embarrassing Episode'

"The Fed has expressed insufficient confidence in the U.S. economy," said Maury Harris, chief economist at UBS Securities LLC in New York, who reckons policy makers will begin raising rates by late 2013. "This could end up being an embarrassing episode in terms of their credibility."

Sinai, who also sees the central bank raising rates by the end of next year, defended the Fed's stance.

"It shows how seriously Bernanke takes the Fed's mandate to achieve full employment," he said.