Low Inflation Gives Yellen Room to Retreat From Key Rate Outlook

While Janet Yellen’s timetable for higher interest rates sent markets reeling, investors may have missed an important caveat: it depends on inflation.

Treasury yields jumped March 19 after Yellen said in her first press conference as Federal Reserve chair that rates could rise “around six months” after asset purchases end, most likely in the fall. At the same time, she cautioned that a decision on interest rates “depends what conditions are like.”