Janet Yellen Speech Live Update
International Business Times
Published Sep 17, 2015 02:59PM ET
Updated Sep 17, 2015 03:30PM ET
Janet Yellen Speech Live Update
By Jessica Menton -
UPDATE 3:17 p.m. EDT
One member of the FOMC would add more stimulus to the U.S. economy by moving interest rates into negative territory. However, it is “not something that we considered very seriously at all today,” Yellen said.
UPDATE 3:05 p.m. EDT
Yellen expects to see further slowing in China's economy. "The question is whether or not there may be a risk of a more abrupt slowdown than most analysts expect," Yellen said.
UPDATE 3 p.m. EDT
Despite leaving rates at historic lows, Yellen leaves the door open in October, saying it "remains a possibility" for a first rate hike.
Original story: As Federal Reserve Board Chair Janet Yellen outlined the central bank's decision to leave interest rates untouched in a Thursday press conference, the Dow Jones Industrial Average jumped more than 150 points, while the S&P 500 and Nasdaq rallied roughly 1 percent.
The Fed is leaving rates at historic lows since the financial crisis began in 2008. Yellen has said the Fed could begin returning interest rates to normal levels sometime this year, but on Thursday she expressed fears that China’s economic slowdown could ripple across the globe and infect U.S. growth. Economists had been evenly split on the prospects of a rate hike this week.
Yellen said "domestic developments have been strong." However, she also noted: "In light of the heightened uncertainties abroad, and the slightly softer expected path for inflation, the committee judged it appropriate to wait for more evidence, including some further improvement in the labor market to bolster its confidence that inflation will rise to 2 percent in the medium term," Yellen said.
The Fed has a “dual mandate” of achieving maximum employment and stabilizing U.S. prices. Inflation will remain lower for longer, Yellen said, due to further declines in oil prices and the appreciation of the U.S. dollar. “It will take a bit more time for these effects to fully dissipate,” Yellen said.
The Fed also released its updated projections for the U.S. economy over the next three years. Fed officials revised upward their projections for gross domestic product growth this year to between 2 percent and 2.3 percent, from 1.8 percent to 2 percent.
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Written By: International Business Times
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