BLOOMBERG REPORTED that Federal Reserve Chair Janet Yellen left little doubt on Friday that the central bank will raise interest rates this month. More importantly, she dropped hints that it might end up having to increase them this year more than planned.
In a speech to The Executives’ Club of Chicago, Yellen singled out the danger of the central bank being too slow in boosting rates.
“We realise that waiting too long to scale back some of our support could potentially require us to raise rates rapidly sometime down the road, which in turn could risk disrupting financial markets and pushing the economy into recession,” she said.
Yellen all but declared that the Federal Open Market Committee would increase rates for the first time this year at its March 14-15 meeting, saying that such a move “would likely be appropriate” if the economy stays on its current track. She also suggested that would not be the last increase this year.
Policy makers pencilled in three-quarter percentage-point rate increases for 2017, according to the median projection in forecasts released in December.
Yellen Hints at More Aggressive Rate Path Upon Locking in March https://bloom.bg/2lnHJA8