Janet Yellen. Alex Wong/Getty Images/AFP
Federal Reserve Chair Janet
Yellen said Friday another interest rate increase could be “appropriate” later
this month if US employment and inflation remain in line with expectations.
Yellen also defended the Fed’s performance, saying it has not been
too slow to raise the benchmark lending rates, given the tepid recovery and
sluggish inflation.
The US central bank last raised the federal funds rate in
December, only the second increase in a decade, but is widely expected to hike
again at the March 14-15 policy meeting given the recent upward move in
inflation.
The Fed’s policy-setting
rate committee “will evaluate whether employment and inflation are continuing
to evolve in line with our expectations, in which case a further adjustment of
the federal funds rate would likely be appropriate,” Yellen said.
However, in her speech prepared for delivery to a Chicago business
group, Yellen said central bankers continue to believe they will only need to
raise rates “gradually” assuming the economic data “continue to come in about
as we expect.”
But she cautioned that monetary policy “cannot be and is not on a
preset course.”
In the face of some critics, even among Fed officials, that the
central bank risks allowing inflation to rekindle by raising rates so slowly,
Yellen defended the committee’s performance.
Waiting too long to raise rates could mean the Fed has to hike more
rapidly at some point, which “could risk disrupting financial markets and
pushing the economy into recession.”
However, Yellen said, “I currently see no evidence that the
Federal Reserve has fallen behind the curve, and I therefore continue to have
confidence in our judgment that a gradual removal of accommodation is likely to
be appropriate.”
Still, she said, unless something worsens the economic outlook
“the process of scaling back accommodation likely will not be as slow as it was
in 2015 and 2016.”
Many economists have pointed to the Fed’s preferred measure of
inflation, which recently reached a targeted two percent annual rate, but
Yellen and other Fed officials have noted that higher energy prices are
contributing to that increase.
Hi. I’m Sana ur Rehman Designer of This Blog. I’m CEO/Founder of Pak Zest. I’m Creative Art Director, Web Designer, UI/UX Designer, Interaction Designer, Industrial Designer, Web Developer, Business Enthusiast, StartUp Enthusiast, Speaker, Writer and Photographer. Inspired to make things looks better.
0 comments:
Post a Comment