Yellen promises to stay the course

|By:, SA News Editor

“Let me emphasize that I expect a great deal of continuity in the Federal Open Market Committee’s approach to monetary policy,” says Janet Yellen in prepared congressional testimony, promising to hold short rates near zero "well past" the time when the headline unemployment rate falls below 6.5%.

She brushes aside recent jitters led by emerging markets , saying at this point they're not a substantial risk to the U.S. economic outlook and are not forcing any recalibration of Fed policy.

Not addressed in the prepared remarks (questioning to begin shortly after 10 ET) are the last two disappointing jobs reports.

As for "too-low" inflation - the PCE is running near 1% - Yellen expects some of the softness to be transitory and for the rate to move closer to the Fed's 2% target this year.

About flat before the remarks, the 10-year Treasury yield is higher by 3 basis points to 2.70%. Stock index futures remain higher by around 0..3%.

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