Yellen Doesn't Tip Her Hand on Rate Hike

Case is stronger, says Fed chief, without offering timetable
By Newser Editors and Wire Services
Posted Aug 26, 2016 10:23 AM CDT
Yellen Doesn't Tip Her Hand on Rate Hike
Federal Reserve Chair Janet Yellen, center, strolls with Stanley Fischer, right, vice chairman of the Board of Governors of the Federal Reserve System, and Bill Dudley, the president of the Federal Reserve Bank of New York.   (AP Photo/Brennan Linsley)

Federal Reserve Chair Janet Yellen said Friday that the case for raising interest rates has strengthened in light of a solid job market and an improved outlook for the US economy and inflation, reports the AP. So does that mean rates are going up? We'll have to stay tuned, because Yellen declined to hint at whether the Fed might raise them at its next policy meeting, Sept. 20-21, or at its subsequent meeting in mid-December. The Wall Street Journal thinks the answer may hinge on the Sept. 2 jobs report.

"In light of the continued solid performance of the labor market and our outlook for economic activity and inflation, I believe the case for an increase (in the Fed's benchmark borrowing rate) has strengthened in recent months," said Yellen in her speech to an annual conference of central bankers in Jackson Hole, Wyoming. She sketched a generally upbeat assessment of the economy, pointing to steady gains in employment and consumer spending. She also noted that while inflation is still running below the Fed's 2% target, it is being depressed mainly by temporary factors. The markets seem pleased, with all three major indexes up about a half-percentage point in the immediate wake of the speech. (Read more Janet Yellen stories.)

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