Fed's Yellen says 'looking forward' to day of first rate rise in decade
By Jason Lange and Howard Schneider
NEW YORK (Reuters) - Federal Reserve Chair Janet Yellen said on Wednesday she was "looking forward" to a U.S. interest rate rise that will be seen as a testament to the economy's recovery from recession.
Fed policymakers are widely seen raising interest rates for the first time in almost a decade at their next meeting on Dec. 15-16, but they continue to parse data and trends carefully given the uneven nature of the U.S. recovery.
In her remarks to the Economic Club of Washington, Yellen expressed confidence in the U.S. economy, saying job growth through October suggested the labor market was healing even if not yet at full strength.
Yellen also reaffirmed her view that the drag on U.S. economic growth and inflation from weakness in the global economy and falling commodity prices would moderate next year. U.S. consumer spending was "particularly solid", she noted.
"When the Committee begins to normalize the stance of policy, doing so will be a testament ... to how far our economy has come," she said, referring to the Fed's policy-setting committee. "In that sense, it is a day that I expect we all are looking forward to."
Investors are already betting the Fed will lift its benchmark federal funds rate this month from the zero to 0.25 percent range where it has been held since 2008. Economists also see a strong chance of a December rate rise.
The U.S. dollar strengthened on Wednesday and stocks fell on Wall Street, after Yellen's comments.
"I was a little surprised she sounded as hawkish as she did given we're two days away from the non-farm payrolls report and a couple of weeks away from the Fed FOMC meeting," said Michael O’Rourke, chief market strategist at JonesTrading in Greenwich, Connecticut. Continued...