Yellen Tempers Weak Numbers with Rebound Forecast

After declaring earlier in the week that the Fed would continue with its stimulus tapering program, Federal Reserve chairwoman Janet Yellen did not offer any information regarding a specific timetable for the Fed’s withdraw from its bond buying program. Instead Yellen, in her testimony before the congressional Joint Economic Committee, focused on the increasing weakness of the housing market and potential impact of ever-growing geopolitical conflicts.

The chairwoman eschewed concerns and criticisms that Fed policies were destabilizing financial markets, turning the focus towards expected growth through the rest of the year despite weaker than expected first quarter data. Said Yellen, “With the harsh winter behind us, many recent indicators suggest that the rebound in spending and production is already underway”.

What this means for the vast majority of us is business as usual. The disappointing economic numbers were tied to severe weather, the tapering program will continue as planned, and interest rates will stay where they are for the short term.