JACKSON HOLE, Wyoming - Federal Reserve Chair Janet Yellen said Friday that the Great Recession complicated the Fed's ability to assess the U.S. job market and made it harder to determine when to adjust interest rates.<br />
Yellen's remarks to an annual Fed conference in Jackson Hole, Wyoming, offered no signal that she's altered her view that the economy still needs Fed support from ultra-low interest rates. The timing of a Fed rate increase remains unclear.<br />
The Fed chair noted that while the unemployment rate has steadily declined, other gauges of the job market have been harder to evaluate and may reflect continued weakness. These include high levels of people who have been unemployed for more than six months, many people working part time who would like full-time jobs and weak pay growth.<br />
Yellen repeated language the Fed has used at its last meeting that record-low short-term rates will likely remain appropriate for a "considerable time" after the Fed stops buying bonds to keep long-term rates down. The Fed's bond buying is set to end this fall.<br />
But Yellen said the Fed's rate decisions will be dictated by how the economy performs.<br />
"Monetary policy is not on a preset course," she said. The Fed "will be closely monitoring incoming information on the labor market and inflation in determining the appropriate stance of monetary policy."<br />
Yellen also suggested that pay gains, which have been sluggish since the recession ended five years ago, could rise faster without necessarily igniting inflation.<br />
John Silvia, chief economist at Wells Fargo, said Yellen's remarks confirmed his view that the Fed's first rate increase will occur next June.<br />
"Yellen still wants more time to evaluate the data," he said.<br />
Silvia also said the speech hints that the Fed is "willing to take a little more inflation to achieve their labor market goals." If inflation were to top the Fed's target of 2 percent, "I don't think they're going to panic."
A blustery winter storm dumped snow and ice across the West on Wednesday, making driving treacherous in the mountains from California to the Rockies and forcing residents and party-goers in some usually sun-soaked cities to bundle up for a frosty New Year's.
House Republican leaders rallied around one of their own, Whip Steve Scalise, on Tuesday after he said he regrets speaking 12 years ago to a white supremacist organization and condemns the views of such groups.
President Vladimir Putin's chief political foe was convicted along with his brother on Tuesday in a fraud case widely seen as a vendetta by the Kremlin, triggering one of Russia's boldest anti-government demonstrations in years.
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