Yelling at Yellen
FRB Chair Yellen today testified before the House FinServ Committee for part one of the semi-annual Humphry-Hawkins hearings, taking even heavier fire than usual from Republicans unhappy with the course of U.S. monetary policy, the way the Fed conducts itself, and the post-crisis rulebook. The chair provided an optimistic if not necessarily certain outlook for the U.S. economy. While Chair Yellen provided an overview of FRB predictions suggesting continued low unemployment and inflation in line with FRB goals, she said that there are equal odds that the economy will be better or worse than the FRB predicts. FinServ Republicans set their sights on two particular topics of interest: the payment of IOER and the size of the Fed’s balance sheet.