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Fed's Yellen testimony: Additional gradual rate hikes likely appropriate over next few years
Key highlights from the pre-released text of the speech by Fed Chairwoman Janet Yellen's first part of 2-day semi-annual testimony in Congress:
- Monetary policy not on pre-set course
- FOMC expects additional gradual rate hikes likely appropriate over next few years
- Inflation response to economy is key uncertainty
- Fed funds rate remains somewhat below neutral level
- On Fed balance sheet: FOMC anticipates reducing Fed balances but larger than pre-financial crisis
- On Fed balance sheet: Does not intend to use balance sheet as active tool for monetary policy in normal times
Author
Eren Sengezer
FXStreet
As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.
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