The Wall Street Journal is out with a quick response to Yellen's speech (not as quick as mine, though)
They say (in summary, link below):
- Yellen laid out her most detailed case yet for the central bank to begin raising short-term interest rates later this year
- Effectively lobbing a warning to financial markets that the central bank's decision to keep rates near zero last week wasn't a shift toward an interminable delay of monetary tightening
Well, OK then ...
And:
- Central to her argument was a belief that slack in the economy has diminished to a point where inflation pressures should start to gradually build in the coming years
- The Fed needs to get in front of this, she said
- "It will likely be appropriate to raise the target range of the federal funds rate sometime later this year and to continue boosting short-term rates at a gradual pace thereafter as the labor market improves further and inflation moves back to our 2 percent objective"
The Journal article is here, it may be gated: Janet Yellen Says Fed Interest Rate Increase Still Likely This Year
-
I've bolded a couple of points. The effect of this speech will be to give added impetus to the 'December hike' brigade (that'd include me ... still ... but don't listen to me, I thought we'd get hikin' in September).
