Federal Reserve Chair Janet Yellen told Congress on Wednesday that the central bank expects to keep raising a key interest rate at a gradual pace and also plans to start trimming its massive bond holdings this year.
In her semiannual testimony on the economy, Yellen took note of a number of encouraging factors, including strong job gains and rising household wealth that she said should fuel economic growth over the next two years.
She blamed a recent slowdown in inflation on temporary factors. But she says Fed officials are watching developments closely to make sure that annual price gains move back toward the Fed’s 2 percent target.
Many economists believe the Fed, which has raised rates three times since December, will hike rates one more time this year.
In her prepared testimony before the House Financial Services Committee, Yellen repeated the message she has been sending all year: the economy