Economics
Yellen Signals Economy Nearly Ready for First Interest-Rate Hike
- Labor market progress seen, higher inflation expected
- Waiting too long for liftoff would raise risk of recession
Yellen: Labor Gains Boost My Confidence in 2% Inflation
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Federal Reserve Chair Janet Yellen delivered a cautiously upbeat outlook for the U.S. economy, signaling the conditions necessary for an interest-rate increase have been met and that she hopes to tighten monetary policy slowly after liftoff.
“I currently judge that U.S. economic growth is likely to be sufficient over the next year or two to result in further improvement in the labor market,” Yellen said, according to the text of Thursday before Congress’s Joint Economic Committee. “Ongoing gains in the labor market, coupled with my judgment that longer-term inflation expectations remain reasonably well anchored, serve to bolster my confidence in a return of inflation to 2 percent.”