Yellen testifies next week on monetary policy

Yellentestifying021114
Shown: Janet Yellen giving her first testimony on monetary policy as Fed chair this February.

July 9, 2014 – Federal Reserve Board Chair Janet Yellen will discuss the economy and her thoughts on the Fed’s monetary policy making during a July 15 hearing of the Senate Banking Committee.

This will be Yellen’s second monetary policy report to Congress since she took the Fed’s top post. Testifying in February, she said she expected the Fed to continue its current policy on quantitative easing. It has done that in each monetary policy setting session held since, gradually reducing its purchases of agency mortgage-backed securities and Treasuries from $85 billion a month, at the top of “QE3,” to $35 billion a month through June.

The federal funds target rate has remained in the range of 0 to 0.25 percent since 2008, and the Fed has indicated no plans anytime soon to change that. It has, however, signaled a willingness to use other tools if developments require that. Yellen, more recently noting a general uptick in financial industry risk-taking, has also held out the possibility of regulatory measures if needed to ensure stability.

Tuesday’s Senate Banking Committee hearing is set for 10 a.m. A similar hearing is expected Wednesday by the House Financial Services Committee.

 

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