Janet Yellen, who rarely raises her voice, is not going quietly into the Trump era.
The 70-year-old Federal Reserve chair said at a congressional hearing that she has no intention of leaving before her term expires, despite criticism from President-elect Donald Trump. She confirmed that the central bank is likely to begin raising interest rates soon in response to an improving economy. And she threw cold water on the president-elect's overtures toward fiscal stimulus and weakening the Dodd-Frank financial reforms passed in the wake of 2008's financial crisis.
"I was confirmed by the Senate to a four-year term," said Yellen, whose appointment runs through January 2018. "I fully intend to serve out that term.''
The chair's prepared testimony followed a path familiar to Fed watchers. It emphasized the improvement in the labor market while pointing out that this year's gains in work force participation suggested that the economy had been suffering from more slack than previously believed. She said those conditions bolster the central bank's generally accommodative monetary policy, which economists and traders believe will include raising the federal funds rate in December and probably twice more next year. Three hikes would bring the central bank's target rate for federal funds to as high as 1.25%.
The Fed's Open Market Committee "continues to expect that the evolution of the economy will warrant only gradual increases in the federal funds rate over time to achieve and maintain maximum employment and price stability," Yellen told the Joint Economic Committee of Congress.
Yellen said global growth should firm next year, in part because of very lax monetary policies by overseas central banks.