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WASHINGTON (MNI) - The following is a response of Federal Reserve Chairman
Janet Yellen to a question from a reporter at her press conference following
Wednesday's Federal Open Market Committee meeting.
You mentioned in response to Steve's question that asset valuations you
didn't think were on the sort of high priority risk list right now. I'm
wondering what do you think is on the risk list? Broadly, what have you left
undone, you have gotten high marks for bringing the economy back towards its
goals, but are there things that are going to nag you when you walk out of here
in February and say, really, I wish I had seen this to completion? We are not
doing negative interest rates. We are not doing inflation framework. What's at
your top of, what is at the top of the to-do list that you are not getting to
see to ground here.
You asked about the risk list. There are always risks that affect the
outlook. We tend to focus in our own evaluation on economic risks. We have
characterized them as balanced. I think they are balanced. I can always give you
a list of, you know, potential troubles, international developments that could
result in downside economic risk.
But, look, at the moment, the U.S. economy is performing well. The growth
that we are seeing, it's not based on, for example, a unsustainable build-up of
debt, as we had in the runup to the financial crisis.
The global economy is doing well. We are in a synchronized expansion. This
is the first time in many years that we have seen this. Inflation around the
world is generally low. So I think the risks are balanced, and there is less to
lose sleep about now than has been true for quite some time.
So I feel good about the economic outlook. I feel, you know, good that the
labor market is in a very much stronger place than it was eight years ago. We
have created 70 million jobs, we have a good strong labor market and a very low
I think that's been tremendously important to the well-being of American
households and workers. I feel very pleased when I hear anecdotes from firms
that tell me they are having a hard time finding workers, and they talk about
given that they are taking on people with skills that don't quite match what
they want, but they are training them, and you know, giving them the training
that they need in order to be able to fill jobs. I think that's a development
that is a natural one that occurs in a strong labor market, that tends to build
human capital and worker skills, and that is a strong positive.
As I mentioned, I think the financial system is on much sounder footing,
and that we have done a great deal to put in place greater capital liquidity and
so forth that make it less crisis prone. And that has been an important
What is on my undone list, you ask? We have a 2 percent symmetric inflation
objective and for a number of years now, inflation has been running under 2
percent. And I consider it an important priority to make sure that inflation
doesn't chronically undershoot our 2 percent objective, and I want to see it
move up to 2 percent.
Most of my colleagues and I do believe that it's being held down by
transitory factors, but there is work undone there, in the sense we need to see
it move up and line with our objective.
--MNI Washington Bureau; +1 202-371-2121; email: firstname.lastname@example.org