Federal Reserve chair Janet Yellen said policymakers ought to be careful of “moving too gradually” on monetary policy despite “significant uncertainties” over inflation.
Ms Yellen, speaking on Tuesday at the annual meeting of the National Association for Business Economics in Cleveland, Ohio, acknowledged that “some key assumptions underlying the baseline outlook could be wrong in ways that imply that inflation will remain low for longer than currently projected”.
But she cautioned against waiting too long to raise interest rates again, underscoring the signal from the Fed’s latest policy meeting last week that another rate rise may be on the cards before the end of 2017.
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