Fed’s Yellen confirms the rate cut – The Republic

MILAN – Delaying too an increase in interest rates is likely to result in a narrow sharply thereafter. This was stated by the chairman of the Fed, Janet Yellen, noting that after the first increase in interest rates the Fed will proceed gradually. “Wait too” to raise interest rates is “a risk.” Also, keep the cost of borrowing at the current level – equal to 0-0.25% for too long could also “encourage excessive risk-taking and thus jeopardize financial stability”. And ‘the warning issued by the president during a news conference. The markets currently seem to point on the assumption of a rise on the occasion of the board in December. According to Yellen, the US economic growth will continue at a moderate pace, with improvements in the labor market that increase the confidence of a rise in inflation.

After a first increase in interest rates from current historical lows, monetary policy Federal Reserve “will remain accommodative.” “A narrow sudden risk destabilizing financial markets and perhaps even inadvertently push the economy into a recession,” said Yellen, which provides that in the coming years the US will maintain a growth rate of “moderate”, but enough to advance still a labor market “still far from full employment.” Fed Chairman then held a weakening of the downward pressure from being crossed volatility in recent months by the Chinese markets and highlighted the tendency “particularly strong” consumer spending in the US.

” The continued improvement in the labor market helps to build confidence that inflation will return to our target of 2% over the medium term “. Yellen added that when there will be a rate hike, it’s up to mean that the economy “has come a long way” in recover from the financial crisis of 2008-2009. “In that sense, I expect that everyone is eager to see that day” to arrive. Although developments in foreign economies still pose risks to the growth of the American economy that we are monitoring, these downside risks from abroad have declined since last summer, “he continued Yellen. About China,” recent data support argument that the slowdown of the Chinese economy, which has received considerable attention, will likely continue to be modest and gradual. China has taken measures to stimulate its economy this year and could do more if necessary “.

From the Beige Book is instead showed a photograph of the 12 districts in the US. The ‘American economic activity “has expanded at modest pace” in most regions between mid-October and 20 November. And’ what emerges from the report on the health of the American economy that the Federal Reserve publishes every six weeks. The result of the analysis conducted in 12 districts in which the US central bank, the document will be used in the next Fed meeting scheduled the next 15 and 16 December. In 10 of the 12 districts analyzed, the Fed has seen growth “modest”, “moderate” or “constant”. The conditions are mitigate in the district of New York and have been “somewhat slower” than in Boston.

Arguments:

Fed

US rates

Starring:

Janet Yellen