Federal Reserve chair Janet Yellen said Tuesday the central bank should proceed with caution when raising its benchmark interest rate amid global uncertainty.
At its March policy meeting two weeks ago, the central bank kept its interest rate steady. The Fed had planned a series of rate hikes up to four times this year, and started in December, when it raised rates for the first time in seven years.
“Given the risks to the outlook, I consider it appropriate for the committee to proceed cautiously in adjusting policy,” Yellen said in a prepared statement at the Economic Club of New York, the Wall Street Journal reported.
Yellen said it has been a “somewhat mixed” performance for the U.S. economy since the beginning of the year, but noted that the U.S. labor market continues to be strong with consumer spending, the housing market and fiscal policy giving a boost, the Journal reported.
Earlier this year, the global market downtown coupled with plummeting oil prices and a slowdown in China have lead to uncertainty. These factors are too significant to ignore, she said, according to the Journal.
“Although the baseline outlook has changed little on balance since December, global developments pose ongoing risks,” Yellen said. “These risks appear to have contributed to the financial market volatility witnessed both last summer and in recent months.”
The Real Deal took a look how the global market turmoil is affecting real estate in New York City. [WSJ] — Dusica Sue Malesevic