The president of the Federal Reserve, Janet Yellen, said Thursday before legislators of the united States that will fulfill his full term, which ends in 2018, and earlier indicated that the Fed could raise interest rates “relatively soon” if the economic indicators continue to point to improvements in the labour market and to inflation that is accelerating.
This, in a clear signal that the Central Bank could announce a rate hike in December.
Yellen noted that the meeting in early November the Fed members felt that the arguments for tightening monetary policy had been strengthened.
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“Such an increase could well be appropriate relatively soon,” said Yellen in prepared remarks, his first statements since the presidential election of November 8, the united States, in which Donald Trump won by Hillary Clinton.
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Yellen, who is presented in these moments in a hearing in the u.s. Congress, said that the country’s economy seemed to be on a path of moderate growth, which could lead to full employment and boost inflation toward the official target of 2%.
legislators present in the commission, that there are members of the House of Representatives and the Senate, will be able to ask questions to Yellen when you finish your statement.
The president of the Fed presented an evaluation on the general upbeat of an economy that continues to generate employment at a pace suitable to absorb the new workers and keep others in their place of work.
The growth of wages “has improved”, said Yellen. Consumer spending, an index is vital to the be the main component of the Gross Domestic Product, “he continued making modest gains” and helped a rebound in economic growth from a weak first half. He said, furthermore, that it expected to consolidate the global growth, something considered for months as a big risk due to the weakness in Europe and China.
Without a doubt, one of the main questions for the Fed now will be the actions that will be launched Trump, but Yellen did not address the elections in their prepared remarks.
Yellen said that, as they are, the current interest rates at between 0.25 and 0.50 percentage points are driving the economic activity, and that the country has “a little more space to go” before inflation becomes a concern.
right Now, he noted, “the risk of being left behind the curve of inflation in the near future seems limited,” and ensures only an increase gradual of the federal funds rate. However, this could change, especially when you take possession of the new Government.
“The path that is appropriate for the federal funds rate will change in response to changes in the landscape,” said Yellen.
Source: Reuters
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