By Martin Crutsinger, AP
NEW YORK–Federal Reserve Chairwoman Janet Yellen said Wednesday that the U.S. job market still needs help from the Fed and that the central bank must remain intent on adjusting its policy to respond to unforeseen challenges. In her first major speech on Fed policy, Yellen sought to explain the Fed’s shifting guidance on its interest-rate policy, which at times has confused or jarred investors. She said the Fed’s policies “must respond to significant unexpected twist and turns the economy may make.”
“Thus far in the recovery and to this day, there is little question that the economy has remained far from maximum employment,” Yellen told an audience at the Economic Club of New York.
She said the Fed’s forecast for moderate growth has changed little since last fall despite the severe winter. Fed officials still see only a gradual return to full employment over the next two to three years, Yellen said.