Fed's Yellen: Removal of monetary policy accommodation working well so far

Speaking at the Herbert Stein Memorial Lecture in Washington DC, Federal Reserve's chairwoman Janet Yellen stated that economy is doing well, but future downturns likely to require renewed use of the unconventional policy.

In a speech titled "Monetary Policy Since the Financial Crisis", Yellen stressed that downward pressure on yield from Fed asset holdings will dissipate only gradually.

More headlines (via Reuters):

• Fed more likely to hit "zero lower bound" in future rate cut cycles
• Unconventional policy tools must be "ready" if needed
• Evidence suggests economy did better because of asset purchases, other Fed actions during crisis
• Removal of monetary policy accommodation working well so far

Additional headlines from Q&A session (via Reuters):

• Some evidence that inflation expectations may have slipped
• Says there is concern consistent miss on inflation will hurt Fed credibility
• Reasons for weak inflation since March not immediately clear
• Inflation undershoot "pretty understandable" until "this year"
• Negative rates may have benefits and is worth studying, but also likely poses costs
• Hope that whatever tax reform is approved is "rich in incentive effects" to improve supply side of economy
• Yellen is not asked and does not volunteer comment about Trump's Fed selection process