Janet L. Yellen
Last quote by Janet L. Yellen
Janet L. Yellen quotes
On the whole, the prospects for further moderate economic growth look encouraging, particularly as risks emanating from abroad appear to have receded somewhat.
Gradual increases in the federal funds rate will likely be appropriate in the months and years ahead: Those increases would keep the economy from significantly overheating, thereby sustaining the expansion and maintaining price stability.
I really liked the form of reasoning. [Economics] has a way of analyzing issues that is systematic and it appealed to the math side of me.
It came together that my concern about people and jobs, and my love of math, found a happy marriage in economics.
Given how close we are to meeting our statutory goals, and in the absence of new developments that might materially worsen the economic outlook, the process of scaling back accommodation likely will not be as slow as it was in 2015 and 2016.
Fiscal and regulatory policies – which are of course the responsibility of the administration and the Congress – are best suited to address such adverse structural trends.
The U.S. economy has exhibited remarkable resilience in the face of adverse shocks. I therefore continue to have confidence that a gradual removal of accommodation is likely to be appropriate. Unless unanticipated developments adversely affect the economic outlook, the process of scaling back accommodation likely will not be as slow as it was during the past couple of years.
The economy has essentially met the employment portion of our mandate and inflation is moving closer to our 2 percent objective. [We] realize 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.
Whether it is March, or May or June ... I can't tell you which meeting it would be.
Nothing going on in these international discussions binds us to carry out things in our rulemaking process.
We don't want to base current policy on speculation about what may come down the line. We will wait to gain greater clarity on policy changes.
The economy is recovering from a very severe crisis. We've put in place stronger financial regulation that has forced our banks to build up their capital buffers to deal with problem loans and to strengthen themselves to the point where they have been to support economic growth and recovery in our economy.
The economy has recovered more quickly, for example, than ... European Union economies have in the aftermath of the crisis. The Federal Reserve has put in place highly accommodative monetary policies meant to spur spending in the economy and restore low unemployment or to achieve the goal of maximizing employment and price stability as assigned to us by Congress. I believe we're coming very close to achieving those objectives, and monetary policy remains accommodative. Economic growth has been quite disappointing.
I think central banks all over the world have recognized that an independent central bank that can focus on the long-term health of the economy ... gives rise to a better economic environment.
I can't tell you exactly which meeting it would be. I would say every meeting would be live.
It's too early to know which policy changes will be put in place or how their economic affects will unfold, while it's not my intention to opine on specific tax or spending proposals, I would point to the importance of improving the pace of longer-run economic growth and raising American living standards with policies aimed at improving productivity.
We will continue to coordinate with the Treasury Department, which is itself a member of several international forums related to financial services, such as the Financial Stability Board (FSB) and the International Association of Insurance Supervisors, as well as with the other U.S. supervisory agencies that participate in various international forums.
In exercising our longstanding authorities and responsibilities for consulting with our foreign counterparts, we share the objective that the whole U.S. government must work constructively to ensure a strong, stable U.S. economy and financial system. Strong regulatory standards enhance the stability of the U.S. financial system. By participating in the development of international regulatory standards, the Federal Reserve can influence the standards in ways that promote the financial stability of the United States and the competitiveness of U.S. firms.
They're lending. U.S. banks are generally considered quite strong relative to their counterparts. They've built up quite a bit of capital, partly as a results of our insistence that they do so.
I would also hope that fiscal policy changes will be consistent with putting U.S. fiscal accounts on a sustainable trajectory.
That's right. It's too early to know what policy changes will be put in place or how their economic effects will unfold.
Waiting too long to remove accommodation would be unwise, potentially requiring the (Fed) to eventually raise rates rapidly, which could risk disrupting financial markets and pushing the economy into recession.
Dan led the Fed's work to craft a new framework for ensuring the safety and soundness of our financial system following the financial crisis and made invaluable contributions across the entire range of the Fed's responsibilities.
Right now our foot is still pressing on the gas pedal, though, as I noted, we have eased back a bit.
Waiting too long to begin moving toward the neutral rate could risk a nasty surprise down the road - either too much inflation, financial instability, or both.
As the economy approaches our objectives, it makes sense to gradually reduce the level of monetary policy support.
Our foot remains on the pedal in part because we want to make sure the economic expansion remains strong enough to withstand an unexpected shock, given that we don't have much room to cut interest rates.
Figuring out what the neutral interest rate is and setting the right path toward it is not like setting the thermostat in a house: You can't just set the temperature at 68 degrees and walk away.
The economy is vast and vastly complex, and its path can take surprising twists and turns.
We will factor (any changes in economic policy) into the outlook and take account of their impact on what we need to do to achieve our dual mandate objectives.
Economists are not certain about many things. But we are quite certain that a college diploma or an advanced degree is a key to economic success.
The drivers of this increasing demand for those with college and graduate degrees are likely to continue to be important.
Some of the participants, but not all of the participants, did incorporate some assumption of a change in fiscal policy into their projections, and that may have been a factor that was one of several that occasioned the shifts.
I would say at this point that fiscal policy is not obviously needed to provide stimulus to help us get back to full employment.
I think it's very important that we have reduced the odds that a systemically important firm could fail by requiring higher capital, higher liquidity, by performing stress tests that provide is another way of insuring that the firms we count on to supply credit to households and businesses would be able to go on doing that even in the face of a severely adverse shock.
We have been given the independence by Congress to make decisions about monetary policy in pursuit of our dual mandate objectives of maximum employment and inflation. That's what I intend to stay focused on, that's what the committee is focused on.
I believe my predecessor and I called for fiscal stimulus when the unemployment rate was substantially higher than it is now.
This is a very modest adjustment in the path of the federal funds rate.
There is clear evidence of better outcomes in countries where central banks can take the long view, are not subject to short-term political pressures. Sometimes central banks need to do things that are not immediately popular.
You need to be selective in terms of your currency choices. I don't think it's a dollar bull run against everything but I do think if you look at the outlook for emerging market currencies, particularly the high-yield currencies at the moment, it is very hard to have a positive currency view.
When there is greater clarity about the economic policies that might be put into effect the (Federal Open Market Committee) will have to factor those assessments of their impact on employment and inflation and perhaps adjust our outlook.
The progress in the labour market has continued and economic activity has picked up from the modest pace seen in the first half of this year. And inflation, while still below the Committee's 2.0 percent objective, has increased somewhat since earlier this year.
I wouldn't agree that the Fed's monetary policy has hampered business investment or been a negative factor. I'm not aware of any evidence that suggests that it is.
It's not clear in my mind why it is that investment spending has been as weak as it is. Initially, we had an economy with a lot of excess capacity. Firms were clearly operating without enough sales to justify a need to invest in additional capacity, and more recently with the economy moving toward full employment, we would expect to see investment spending pick up, and it's not obvious exactly why it hasn't picked up.
Such an increase could well become appropriate relatively soon.
The appropriate path for the federal funds rate will change in response to changes to the outlook.
The risk of falling behind the curve in the near future appears limited, and gradual increases in the federal funds rate will likely be sufficient to get to a neutral policy stance over the next few years.
With the federal funds rate currently only somewhat below estimates of the neutral rate, the stance of monetary policy is likely moderately accommodative, which is appropriate to foster further progress toward the FOMC's objectives.
Gradual increased in the federal funds rate will likely be sufficient to get to a neutral policy stance over the next few years.
I would not want to see the clock turned back on all the improvements we have made.
We were not really certain that this is something that would happen. The economy has a little more room to run than might have been previously thought.
In addition, a tight labor market might draw in potential workers who would otherwise sit on the sidelines and encourage job-to-job transitions that could also lead to more efficient - and, hence, more productive - job matches. Finally, albeit more speculatively, strong demand could potentially yield significant productivity.
If strong economic conditions can partially reverse supply-side damage after it has occurred, then policymakers may want to aim at being more accommodative during recoveries than would be called for under the traditional view that supply is largely independent of demand.
This post-crisis experience suggests that changes in aggregate demand may have an appreciable, persistent effect on aggregate supply - that is, on potential output.
Research by Federal Reserve staff suggests that, all told, U.S. monetary policy spillovers to other economies are positive – that is, policies designed to provide stimulus to the U.S. economy also boost activity abroad, as negative effects of dollar depreciation are offset by positive effects of higher U.S. imports and easier foreign financial conditions.
If we found, I think as other countries did, that they could reach the limits in terms of purchasing safe assets like longer-term government bonds, it could be useful to be able to intervene directly in assets where the prices have a more direct link to spending decisions.
I don't think there's a conflict of interest there. What's important to me is whether or not [in] decision-making, or collective decision-making, I see politics being brought to bear. … I have never seen that on the part of any of my colleagues.
I certainly have never been pressured in any way by the administration. The (Obama) administration, my experience has been, greatly respects the Fed's independence to make decisions in accordance with the Fed's mandate.
If we allow the economy to overheat, we could be faced with having to raise interest rates more rapidly than we would want which could conceivably jeopardize that good state of affairs that we have come close to achieving.
I think it is very important that senior management be held accountable.
The existing capital conservation buffer would be replaced with a risk-sensitive, firm-specific buffer that is sized based on stress test results.
She "would expect to see (a rate increase this year) if we continue on the current course of labor market improvement, and there are no major risks that develop and we stay on the current course.
We are not reconsidering, at this time, calculation of the surcharges.
Senior management has a responsibility and it's essential that they be held accountable.
I can say emphatically that partisan politics plays no role in our decisions about the appropriate stance of monetary policy. We are trying to decide what the best policy is to foster price stability and maximum employment and to manage the variety of risks that we see as affecting the outlook. We do not discuss politics at our meetings and we do not take politics into account in our decisions.
The Federal Reserve is not politically compromised. We do not discuss politics in our meetings. I can't recall any meeting that I've ever attended where politics has been a matter of discussion.
The case for an increase in the federal funds rate has strengthened.
The economy has a little more room to run than previously thought.
The case for an increase ... has strengthened in recent months.
Our ability to predict how the federal funds rate will evolve over time is quite limited. The chart that put the expected rate path released by the Fed in June in the middle of a broad set of likely outcomes.
In addition to taking the federal funds rate back down to nearly zero, the FOMC could resume asset purchases and announce its intention to keep the federal funds rate at this level until conditions had improved markedly – although with long-term interest rates already quite low, the net stimulus that would result might be somewhat reduced.
In light of the continued solid performance of the labour market and our outlook for economic activity and inflation, I believe the case for an increase in the federal funds rate has strengthened in recent months.
They're scared stiff right now. Oil prices and the possibility of inverting the yield curve are probably concerns.
We do not target the level of stock prices. That is not an appropriate thing to do.
We're going to look at what the trajectory is for the economy, for the goals Congress has assigned us, namely inflation and maximum employment, and take policies we think are appropriate to foster them.
The upcoming vote "could have significant economic repercussions.
I don't think that is the most likely case, but we just don't really know what will happen and we will have to watch very carefully.
While it is an important report, I would also emphasize that it's important never to overblow the significance of a single report or a small amount of data.
Economic growth has been uneven over recent quarters. Subdued foreign growth and the appreciation of the dollar weighed on exports while the energy sector was hit hard by the steep drop in oil prices since mid-2014. In addition, business investment outside of the energy sector was surprisingly weak.
Brexit, the upcoming UK decision on whether or not to leave the European Union, is something we discussed and I think it's fair to say that it was one of the factors that factored into today's decisions.
We are quite uncertain about where rates are heading in the longer term.
We do need to make sure that there's sufficient momentum.
It was one of the factors.
The overall labor market is quite positive.
For a time in January and early February, financial markets here and broad became turbulent and financial conditions tightened, reflecting and reinforcing concerns about downside risks to the global economy.
She "certainly wouldn't describe this as a bubble economy.
The U.S. economy has continued to progress in a satisfactory way. We continue to see good job performance, some evidence of inflation moving up, so that was our expectation when we raised rates in December. So yes, there is accommodation in the monetary policy that we have. But we think the gradual path of rate increases will be appropriate. We remain on a reasonable path and I don't think December was a mistake.
The future path of the federal funds rate is necessarily uncertain because economic activity and inflation will likely evolve in unexpected ways.
Given the risks to the outlook, I consider it appropriate for the Committee to proceed cautiously in adjusting policy.
You've seen oil rebound today, which people are viewing very much as a kind of a green flag in the short-term to take on risk again to a certain degree. To me, this continues to be a counter-trend rally in the context of an intermediate to longer-term decline in the stock market. Our view is that this is nowhere near the resumption of a bull market.
We are watching developments very carefully. I would say there is always some chance of a recession in any year. But the evidence suggests that expansions don't die of old age.
The outlook for employment and inflation are dismal. We will miss both objectives by a country mile for years to come.
This action marks the end of an extraordinary seven-year period during which the federal funds rate was held near zero to support the recovery of the economy from the worst financial crisis and recession since the Great Depression.
Ongoing gains in the labour market, coupled with my judgment that longer-term inflation expectations remain reasonably well anchored, serve to bolster my confidence in a return of inflation to two percent. Moreover holding the federal funds rate at its current level for too long could also encourage excessive risk taking and thus undermine financial stability.
Although the economy continues to improve, the recovery is not yet complete.
The committee decided to make another modest reduction in the pace of it's purchases of longer term securities. The committee maintained its forward guidance regarding the federal funds rate target.
One prominent risk is that adverse developments abroad, such as heightened geopolitical tensions or an intensification of financial stresses in emerging market economies, could undermine confidence in the global economic recovery.
I expect that economic activity will expand at a somewhat faster pace this year than it did last year.
If incoming information broadly supports the (Federal Open Market) Committee's expectation of ongoing improvement in labour market conditions, and inflation moving back towards its longer run objective, the Committee will likely reduce the pace of asset purchases in further measured steps at future meetings.
I would agree that this programme cannot continue for ever. There are costs and risks associated with the programme.
I think that's a very worthwhile idea.
I consider it imperative that we do what we can to promote a very strong recovery. We are doing that by continuing our asset purchase programme, which we put in place with the goal of assuring a substantial improvement in the outlook for the labour market.
It is important not to remove support while the recovery is still fragile.
The message that we want to send is that we will do what is in our power to assure a robust recovery, in the context of price stability.