Yellen sees more rate hikes ahead if economy stays on course

(Feb 14): Federal Reserve Chair Janet Yellen said more interest-rate increases will be appropriate if the US economy meets the central bank’s outlook of gradually rising inflation and tightening labor markets.

“At our upcoming meetings, the committee will evaluate whether employment and inflation are continuing to evolve in line with these expectations, in which case a further adjustment of the federal funds rate would likely be appropriate,” she told the Senate Banking Committee in prepared remarks Tuesday.

Yellen’s semi-annual report on monetary policy is her first since Donald Trump became president vowing to boost US growth, which could push the Federal Open Market Committee to pick up the pace of rate hikes if such steps fan higher inflation. She reiterated that falling behind on inflation could harm to the economy and possible cut short the expansion.

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