Yellen says Fed has more work to do to support recovery

Email|Print|Comments       twitter     facebook     Sina Microblog     reddit    

WASHINGTON, Nov. 14 -- The Federal Reserve has more work to do to bolster the economy which is performing far short of potential, Janet Yellen, President Barack Obama's nominee to lead the U.S. central bank, said Thursday.

"A strong recovery will ultimately enable the Fed to reduce its monetary accommodation and reliance on unconventional policy tools such as asset purchases," Yellen, currently the Fed's vice chair, said in prepared remarks to the Senate Banking Committee.

"I believe that supporting the recovery today is the surest path to returning to a more normal approach to monetary policy," she said.

Yellen said that although the U.S. economy is significantly stronger and continues to improve, the nation has "farther to go to regain the ground lost in the crisis and the recession."

"Unemployment is down from a peak of 10 percent, but at 7.3 percent in October, it is still too high, reflecting a labor market and economy performing far short of their potential," she added.

She also voiced concerns that the inflation has been running below the Fed's goal of 2 percent and is expected to continue to do so for some time.

"For these reasons, the Federal Reserve is using its monetary policy tools to promote a more robust recovery," Yellen said.

She also paid tribute to current Chairman Ben Bernanke, saying that under his wise and skillful leadership, the Fed helped stabilize the financial system, arrest the steep fall in the economy and restart growth.

Lawmakers in the banking committee will weigh Yellen's nomination and likely hold a vote in the coming weeks before sending the nomination to the full Senate, which will vote to confirm her. If confirmed by the Senate, Yellen will take the helm after Bernanke's term expires at the end of January 2014, and become the first woman to lead the Fed.

The leadership transition comes at a pivotal moment of the Fed. After stimulating the economy for five years following the financial crisis, the Fed needs to wind down its asset purchases and gradually normalize its policy with good timing.

• Obama names Yellen as next Federal Reserve chair
• Obama to name Janet Yellen as next Fed chair
• Oil prices fall on Fed tapering fears
• Gold rises ahead of Bernanke's testimony
• U.S. dollar strengthens on Fed tapering speculation
• Fed officials divided on when to taper off QE3
• U.S. Fed adopts higher capital standards for banks
• Fed's goal of calibrating asset purchases hard to achieve: experts
• Wall Street retreats amid speculation about Fed's exit from QE
• U.S. Fed continues ultra-loose monetary policy to bolster growth

We Recommend

• Luxury-cars parade held in Dubai
• Special forces take tough training sessions
• Fire guts 22-storey Nigeria commercial building in Lagos
• A girl takes care of paralyzed father for 10 years
  
• A record of Beijing air quality change
• In pictures: explosions occur in Taiyuan
• Live a harmonious life in Pu'er, SW China
• Weekly Sports Photos
• Gingko leaves turn brilliant golden yellow in Beijing