Janet Yellen Strikes Cautious Note in First Congress Testimony as Fed Chief

Central Banker Calls Recovery 'Far From Complete'

getty images

By Reuters

Published February 11, 2014.
  • Print
  • Share Share
  • Single Page

New Federal Reserve Chair Janet Yellen said on Tuesday the labor market recovery is “far from complete” despite a drop in unemployment, yet she said the U.S. central bank expects to continue trimming policy stimulus in measured steps due to broader improvements in the economy.

In her first public comments as Fed chief, Yellen, giving a balanced testimony to a House committee, nodded to the recent volatility in global financial markets, but said at this stage it does “not pose a substantial risk to the U.S. economic outlook.”

She emphasized continuity in the Fed’s approach to policy, saying she strongly supports the approach driven by her predecessor, Ben Bernanke.

While the unemployment rate has fallen by 1.5 percentage points since the latest bond-buying program began in September of 2012, at 6.6 percent the rate remains “well above levels” the Fed sees as consistent with maximum sustainable employment, Yellen said.

“(T)he recovery in the labor market is far from complete,” she said according to prepared remarks to the Republican-controlled House Financial Services Committee.

Yellen, in just her second week on the job, cited the “unusually large fraction” of jobless Americans who have been out of work for more than six months, and the “very high” number of part-time workers who would prefer full-time jobs.

“These observations underscore the importance of considering more than the unemployment rate when evaluating the condition of the U.S. labor market,” she said.

More than five years after the recession ended, the Fed has embarked on perhaps its most difficult policy shift as it tries to back away from flooding the financial system with ultra-easy money while at the same time convince investors that interest rates will stay near zero well into next year.

Encouraged by momentum in the economy last year, the Fed has trimmed asset purchases twice since December; it now buys $65 billion in Treasuries and mortgage bonds each month, to keep borrowing costs low and encourage investment and hiring.


The Jewish Daily Forward welcomes reader comments in order to promote thoughtful discussion on issues of importance to the Jewish community. In the interest of maintaining a civil forum, The Jewish Daily Forwardrequires that all commenters be appropriately respectful toward our writers, other commenters and the subjects of the articles. Vigorous debate and reasoned critique are welcome; name-calling and personal invective are not. While we generally do not seek to edit or actively moderate comments, our spam filter prevents most links and certain key words from being posted and The Jewish Daily Forward reserves the right to remove comments for any reason.





Find us on Facebook!
  • Undeterred by the conflict, 24 Jews participated in the first ever Jewish National Fund— JDate singles trip to Israel. Translation: Jews age 30 to 45 travelled to Israel to get it on in the sun, with a side of hummus.
  • "It pains and shocks me to say this, but here goes: My father was right all along. He always told me, as I spouted liberal talking points at the Shabbos table and challenged his hawkish views on Israel and the Palestinians to his unending chagrin, that I would one day change my tune." Have you had a similar experience?
  • "'What’s this, mommy?' she asked, while pulling at the purple sleeve to unwrap this mysterious little gift mom keeps hidden in the inside pocket of her bag. Oh boy, how do I answer?"
  • "I fear that we are witnessing the end of politics in the Israeli-Palestinian conflict. I see no possibility for resolution right now. I look into the future and see only a void." What do you think?
  • Not a gazillionaire? Take the "poor door."
  • "We will do what we must to protect our people. We have that right. We are not less deserving of life and quiet than anyone else. No more apologies."
  • "Woody Allen should have quit while he was ahead." Ezra Glinter's review of "Magic in the Moonlight": http://jd.fo/f4Q1Q
  • Jon Stewart responds to his critics: “Look, obviously there are many strong opinions on this. But just merely mentioning Israel or questioning in any way the effectiveness or humanity of Israel’s policies is not the same thing as being pro-Hamas.”
  • "My bat mitzvah party took place in our living room. There were only a few Jewish kids there, and only one from my Sunday school class. She sat in the corner, wearing the right clothes, asking her mom when they could go." The latest in our Promised Lands series — what state should we visit next?
  • Former Israeli National Security Advisor Yaakov Amidror: “A cease-fire will mean that anytime Hamas wants to fight it can. Occupation of Gaza will bring longer-term quiet, but the price will be very high.” What do you think?
  • Should couples sign a pre-pregnancy contract, outlining how caring for the infant will be equally divided between the two parties involved? Just think of it as a ketubah for expectant parents:
  • Many #Israelis can't make it to bomb shelters in time. One of them is Amos Oz.
  • According to Israeli professor Mordechai Kedar, “the only thing that can deter terrorists, like those who kidnapped the children and killed them, is the knowledge that their sister or their mother will be raped."
  • Why does ultra-Orthodox group Agudath Israel of America receive its largest donation from the majority owners of Walmart? Find out here: http://jd.fo/q4XfI
  • Woody Allen on the situation in #Gaza: It's “a terrible, tragic thing. Innocent lives are lost left and right, and it’s a horrible situation that eventually has to right itself.”
  • from-cache

Would you like to receive updates about new stories?




















We will not share your e-mail address or other personal information.

Already subscribed? Manage your subscription.