Janet Yellen: Delaying interest rate hikes "unwise"

Apple continues to show strength gaining 1% Tuesday afternoon

U.S. Federal Reserve Chair Janet Yellen told a congressional committee Tuesday, that she expects the economy to continue its modest expansion.

Waiting too long to raise rates "would be unwise" and could eventually force the Fed to raise rates rapidly to catch up, Yellen said.

The highlight of Fed Chair Yellen's testimony thus far was perhaps her comment on how it would be short-sighted to not raise rates multiple times this year.

Many economists caution that the pace of rate increases could change quickly depending on how much success Trump has in getting his economic initiatives enacted.

Financial markets specialist Professor James Angel from Georgetown University explained why: "Often politicians will want central banks to do things that are short term expedient, but long term risky for the economy".

Yellen said the Fed did not increase the rate earlier this month "but reiterated that it expects the evolution of the economy to warrant further gradual increases in the federal funds rate to achieve and maintain its employment and inflation objectives".

In a hearing before the Senate Banking Committee Tuesday, they pressed Yellen on the economic impact of everything from tax reform and the possible repeal of the Affordable Care Act, to immigration and even climate change. During the financial crisis, the Fed purchased large-scale assets to hold down long-term interest rates.




She went on to say that a rate increase will be likely be appropriate at one of the forthcoming meetings if the economy remains on track. US stock indexes opened slightly lower Tuesday morning after breaching record highs on Monday. His resignation, effective in early April, will create a third vacancy on the seven-member board for Trump to fill. On Jan. 31, the vice chair of the House Financial Services Committee - one of the two committees before which Yellen will testify - sent the Fed chair a letter urging her organization to stop negotiating with other countries over global regulatory standards. The funds rate is now targeted in the 0.5 percent to 0.75 percent range. With stock markets at record levels, investors closely eyed her remarks for any clues about what will send rates higher and the central bank's outlook and expectations on fiscal policy under President Donald Trump's administration.

But based on her comments on Tuesday, Yellen and Trump officials are likely to disagree about precisely what to do next. Markets are still betting on the first hike in June.

Other proposals by Congress have suggested tying the Fed's monetary policy decisions to a mathematical formula.

On how she'll "deal with" three new Fed governors to be appointed by Trump, as Sen.

Yellen agreed an executive order from the president calling for a review of the usefulness of current polices and regulations could be helpful.

Over the past four decades, the U.S. Federal Reserve has steadily gained power and independence in its policymaking.

Related news:

Hot News

isis-killer-beheading-video-story-top 33 killed after coach overturns in Taiwan
Feb 15, 2017 - 01:00
Mr Lee told The Straits Times that the bus was in "good condition" and had passed a maintenance inspection last month. But a Travel Agent Association of Taiwan spokesman said the driver had "sufficient rest", AFP reported .

isis-killer-beheading-video-story-top How Best To Look After Your Blooms This Valentine's Day
Feb 15, 2017 - 00:59
The store is actually receiving so many orders that she said they've been having a little trouble keeping up with the demand. But this Sunday, employees were hard at work preparing for one of the most profitable holidays for their business.

isis-killer-beheading-video-story-top Cheese brands recalled due to Listeria concerns
Feb 15, 2017 - 00:59
The company urges consumers to go online and check the UPC code on their cheese to see whether it is affected by the recall. Consumers are advised to go to Sargento's website to determine if products they have purchased are being recalled.

isis-killer-beheading-video-story-top Cars catch fire in Disneyland parking structure, no word on cause
Feb 15, 2017 - 00:58
The cause of the fire is now under investigation, but there is nothing to suggest foul play at this time. The fire, which was on the second level of the structure, was extinguished in less than 30 minutes.

isis-killer-beheading-video-story-top Mitsubishi names new SUV the Eclipse Cross | New Release
Feb 15, 2017 - 00:56
At the end of January, Mitsubishi released a teaser image of the new crossover it would unveil at the 2017 Geneva Motor Show. Mitsubishi pulled the plug on the plant altogether then shut it down a year ago , according to Automotive News .

isis-killer-beheading-video-story-top NASA will hunt for alien life on Jupiter moon Europa
Feb 15, 2017 - 00:55
Then, they will collect data which will help them in the preparation for an actual landing on the icy moon of Jupiter. The lander would be quite busy during its brief operational life, as its proposed instrument payload indicates.

isis-killer-beheading-video-story-top 9th Circuit, Citing Education and Other Factors, Refuses to Reinstate Travel Ban
Feb 14, 2017 - 01:08
Earlier Friday, Trump vowed to do " whatever is necessary to keep our country safe". And there are tremendous threats to our country.

isis-killer-beheading-video-story-top Google Valentine's Day Logo
Feb 14, 2017 - 00:55
From there, the pangolin sets out for China , where it learns to dance before embarking on its final ques to the Philippines. The easiest way to launch the game is to head to the Google homepage - Google.co.uk - and hit the play symbol.

isis-killer-beheading-video-story-top Lady Gaga Just Got a Huge Pre-Grammys Back Tattoo
Feb 14, 2017 - 00:54
LADY Gaga and John Travolta didn't stop partying at the end of the 2017 Grammys broadcast. But she soon topped it with her wonderful stage time at the 2017 Grammys.

isis-killer-beheading-video-story-top Google Maps updated with improved Your Places functionality
Feb 14, 2017 - 00:53
For example, if you plan a museum trip in a new city you're visiting, you can add them all to a "Museums" to visit list. Once you find a destination that you'd like to add, you'll want to click/tap the icon that's listed as " Save ".

isis-killer-beheading-video-story-top Trump's dinner with Japan's PM was an intelligence security nightmare
Feb 14, 2017 - 00:48
President Donald Trump called North Korea a "big problem" following the communist nation's latest ballistic missile launch. However, China said that the root cause of North Korean missile launches is friction with the US and South Korea.

isis-killer-beheading-video-story-top Donald Trump's Home Line Dropped From Sears & Kmart For Poor Sales
Feb 13, 2017 - 01:10
He served on the Sears Holding Corp. board for over 11 years, but stepped down in December, according to the Associated Press . These decisions have coincided with liberal pressure to not promote any merchandise relating to the Trump family.

isis-killer-beheading-video-story-top DeVos confirmation as ed secretary rankles electeds
Feb 13, 2017 - 01:07
She has been criticized for what opponents say is her support for school choice through charter schools and vouchers. Another protester screamed that DeVos "does not represent" what the 7th St.

isis-killer-beheading-video-story-top Wenger: Arsenal players coped well with 'edgy atmosphere'
Feb 13, 2017 - 01:05
His aggressive style of football has been very successful in the past, first at Red Bull Salzburg and now at Bayer Leverkusen. They are now six points clear at the top of the standings and in with a great chance of making it six in a row.

How To Watch The Grammys Online
Feb 13, 2017 - 01:05
Several Canadians will be going for gold at tonight's Grammy Awards, including two of the country's biggest pop performers . I was probably watching in 1971 when "Bridge Over Troubled Water" won Best Song, Record and Album with almost a clean sweep.