Federal Reserve Chair Janet Yellen made the case for the central bank's next rate hike in her speech Friday in Jackson Hole, Wyo. 'Indeed, in light of the continued solid performance of the labor market and our outlook for economic activity and inflation, I believe the case for an increase in the federal funds rate has strengthened in recent months,' she said. Yellen added that the FOMC expects gradual hikes in short-term interest rates 'will be appropriate over time.' But she didn't give any indication as to whether the hike would come in September or December of this year, something investors were hoping to hear. Yellen also acknowledging inflation, which has remained low for years. The Fed's preferred inflation gauge, the personal consumption expenditure price index, is up only 1.6 percent year-over-year, on a core basis, which does not account for food and energy prices. 'Inflation has continued to run below the FOMC's objective of two percent, reflecting in part the transitory effects of earlier declines in energy and import prices.' Yellen also said that even though fiscal reform is crucial to boosting the economy, she anticipates that there's still an important role for monetary policy. TheStreet's Scott Gamm reports from Wall Street.