Although Yellen expressed caution about too steep a rise in U.S. rates, she sounded more confident than she has in the past that the U.S. economy has rebounded from a weak winter and that inflation would edge higher toward the Fed’s 2 percent target.
“The process is likely to proceed gradually,” Federal Reserve Chair Janet Yellen said, a hint that further hikes will be slow in coming.
“I think the point of ‘liftoff’ is close,” Atlanta Fed President Dennis Lockhart said in prepared remarks for an address to the Atlanta Press Club. “The economy has made great gains and is approaching an acceptable normal… conditions are no longer extraordinary.”
New data on service sector gains gave way to concerns from investors who fear it will provide a green light for the Federal Reserve to start raising interest rates.
“The Fed is taking baby steps towards a rate hike. Enough improvements have been made in the labor market that the Fed only needs a little more confirming evidence to say it is time,” said Brian Jacobsen, chief portfolio strategist at Wells Fargo Funds Management.
Washington (AFP) — Price gains in the U.S. housing market slowed further in June as pent-up buying pressure eases, the S&P/Case-Shiller index showed Tuesday. Home prices continued to rise, but the 20-city price index rose at an annual rate of 8.1 percent in June, down from 9.3 percent in May and 10.8 percent in April. […]
Washington (AFP) — The Federal Reserve on Wednesday stuck to its plan of holding its base interest rate near zero while steadily trimming its stimulus, despite a surprisingly strong second-quarter economic growth report. The Fed as expected reduced its monthly bond purchases by $10 billion, taking the program to $25 billion a month, but said […]
Washington (AFP) — The Federal Reserve could raise its interest rate sooner than expected as the jobs market improves, Fed Chair Janet Yellen said Tuesday, adding the Fed was closely watching for risks. Yellen, in testimony to Congress, said the policy-setting Federal Open Market Committee (FOMC) was closely following developments in the economy to determine […]