Fed chair: Waiting too long to hike interest rates is 'unwise'

Federal Reserve Chairwoman Janet Yellen testified before Congress for the first time since President Trump took office.
2:43 | 02/14/17

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Transcript for Fed chair: Waiting too long to hike interest rates is 'unwise'
Against the backdrop that he had wins weighing on the economy over the past year. Including financial market stresses. That emanated from developments abroad. The committee maintains an unchanged target for the fickle fund street. For most of the year in order to support improvement in the labor market and in the increase in inflation. Toward 2%. At its December meeting the committee reads the target range for the federal funds street. By one quarter percentage point to one half to three quarters percent. In doing so the committee recognize the considerable progress. The economy had made towards the FOMC's dual objectives. The committee judged that even after this increase in the federal funds rate target. Monetary policy remains accommodative. Thereby supporting. Some British strengthening of labor market conditions. And a return to 2% inflation. At its meeting that concluded early this month the committee left the target range for the federal funds rate unchanged. But reiterated. That it expects the evolution of he economy. Warren for your gradual increases. In the federal funds rate. Two we chief it maintained its employment and inflation objectives. As I noted on previous occasions. Waiting too long to remove accommodation. Would be unwise. Potentially requiring the FOMC. To eventually raise rates rapidly. Which could risk disrupting financial markets and pushing the economy into recession. Incoming data suggest that labor market conditions. Continued to strengthen. And inflation is moving up to 2%. Consistent with the committee's expectations. At our upcoming meetings. That committee will evaluate with your employment and inflation. Our continuing to have evolved. In line with these expectations. In which case he for accurate adjustment of the federal funds rate would likely be appropriate. The committee's view that gradual increases in the federal funds rate will likely be appropriate. Reflects the expectation. That the neutral federal from. Funds rate that is the interest rate it is neither expansionary. Nor contraction airing. And it keeps the economy operating on an even keel. Will write some what over time.

This transcript has been automatically generated and may not be 100% accurate.

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