Date
26 May 2017
Janet yellen has expressed confidence in the US economy, citing improving labor market and solid consumer spending. Photo: Reuters
Janet yellen has expressed confidence in the US economy, citing improving labor market and solid consumer spending. Photo: Reuters

Yellen ‘looking forward’ to first US rate hike in decade

Federal Reserve Chairwoman Janet Yellen on Wednesday expressed confidence in the US economy and said that she is “looking forward” to the central bank’s first interest rate hike in nearly a decade.

“When the Committee begins to normalize the stance of policy, doing so will be a testament … to how far our economy has come,” she said, referring to the Fed’s policy-setting committee.

“In that sense, it is a day that I expect we all are looking forward to,” Reuters quoted her as saying in an address to the Economic Club of Washington. 

The Fed’s monetary policy committee will on Dec. 15 begin a two-day meeting that is expected to result in a hike in the central bank’s key rate.

The Fed has held its benchmark federal funds in the zero to 0.25 percent range since 2008. The central bank last raised the rate in 2006.  

In her remarks Wednesday, Yellen said job growth through October suggested that the labor market was recovering even if not yet at full strength.

She also reaffirmed her view that the drag on US economic growth and inflation from weakness in the global economy and falling commodity prices will moderate next year, the report said.

Consumer spending is “particularly solid”, she noted.

Yellen is due to testify on the economic outlook before a joint Congressional committee on Thursday.

As in previous speeches, the central bank chief said the timing of the first US rate hike in nearly a decade is not as important as the path of subsequent rises which policymakers expect will be gradual.

Waiting too long to raise rates could deal an accidental blow to the economy, she warned.

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CG/RC

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