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Scott Minerd
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As Chairman of Investments and Global Chief Investment Officer, Mr. Minerd guides Guggenheim’s investment strategies and leads its research on global macroeconomics. Prior to joining Guggenheim Partners, Mr. Minerd was a managing director for Morgan Stanley and Credit Suisse. He is involved in... More
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  • Yellen: Around Six Months…Or Longer? 1 comment
    Mar 20, 2014 5:19 PM

    There were two key takeaways for investors from Federal Reserve Chairwoman Janet Yellen's press conference after leading her first meeting of the Federal Open Market Committee - do not expect interest rates to rise until mid-2015, and, if inflation remains subdued, the zero bound could continue for even longer.

    Asked by a reporter how long it would take after the Fed completes tapering its asset purchases for the FOMC to hike the federal funds rate, Dr. Yellen replied, "Something on the order of around six months or that type of thing, but you know, it depends … what conditions are like." With tapering expected to end at the latest by December, that suggests a first rate hike in the second quarter of 2015.

    However, Dr. Yellen made clear that such a move depends on the level of inflation at the time. "If inflation is persistently running below our 2 percent objective, that is a very good reason to hold the funds rate at its present range for longer." The inflation measure which the Fed tracks most closely, Personal Consumption Expenditures excluding food and energy, is now at 1.1 percent.

    This commentary has been prepared for informational purposes only and should not be considered as investing advice or a recommendation of any particular security, strategy or investment product. This commentary contains opinions of the author but not necessarily those of Guggenheim Partners or its subsidiaries. The author's opinions are subject to change without notice. Forward looking statements, estimates, and certain information contained herein are based upon proprietary and non-proprietary research and other sources. Information contained herein has been obtained from sources believed to be reliable, but not guaranteed as to accuracy. This commentary may not be reproduced, redistributed or published in whole or in part for any purpose absent the written consent of Guggenheim Partners, LLC. ©2014, Guggenheim Partners.

    Past performance is not indicative of future results. There is neither representation nor warranty as to the current accuracy of, nor liability for, decisions based on such information.

    Guggenheim Partners, LLC is a privately held global financial services firm. For more information visit

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  • kingsmill
    , contributor
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    Thanks for your thoughts especially as they are invariably expressed succinctly. Chairman Yellen undoubtedly was trying to express a general time frame during which data could evolve and that time frame would be measured in quarters not days or years. She is also indicating that the Fed continues to pay attention (thankfully in my view) to the dual mandate and will allow the goals to rule.
    21 Mar, 03:02 PM Reply Like
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