Tags: federal reserve | janet yellen | economic growth

Time Magazine: Yellen Hopeful for 3 Percent GDP Growth in 2014

Thursday, 09 January 2014 09:00 AM

Janet Yellen, set to take over as head of the Federal Reserve next month, is "hopeful" that U.S. economic growth will accelerate in 2014 to reach 3 percent or more and persistently low inflation will move up toward the central bank's target, according to a Time magazine interview released Thursday.

"I think we'll see stronger growth this year," Yellen said in the interview, released online ahead of the Time edition's Jan. 20 publishing date.

"Most of my colleagues on the Fed's policymaking committee and I are hopeful that the first digit (of GDP growth) could be 3 rather than 2."

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U.S. gross domestic product growth has averaged 2.6 percent through the first three quarters of 2013, but appears to have gathered momentum in the second half the year.

Yellen, who will succeed Fed Chairman Ben Bernanke on Feb. 1, also said she believes that the persistently low level of inflation, a worry for policy-makers, will pick up.

"The recovery has been frustratingly slow, but we're making progress in getting people back to work, and I anticipate that inflation will move back toward our longer-run goal of 2 percent," she said.

Yellen, 67, is the first woman to head the Fed. She will preside over an unwinding of the central bank’s stimulus program if the economy performs as forecast.

Yellen addressed criticism that the asset purchases are “just helping the rich.”

“It’s not true,” she said. “Our policy is aimed at holding down long-term interest rates, which supports the recovery by encouraging spending.”

Part of the stimulus “comes through higher house and stock prices, which causes people with homes and stocks to spend more, which causes jobs to be created throughout the economy and income to go up through the economy,” she said.

“I’d like to see real wages going up,” she said.

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Economy
Janet Yellen, set to take over as head of the Federal Reserve next month, is hopeful that U.S. economic growth will accelerate in 2014 to reach 3 percent or more and persistently low inflation will move up toward the central bank's target, according to a Time magazine...
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2014-00-09
Thursday, 09 January 2014 09:00 AM
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