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Business

Fed’s Yellen tampers expectations for June rate hike

Opening sequence

Opening sequence

Business

Fed’s Yellen tampers expectations for June rate hike

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COMING UP:Fed’s Yellen tampers expectations for June rate hike

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Transcript

00:00:01
>> Federal Reserve chair Janet Yellen still believes the economy is strong enough for the second rate hike since the end of the financial crisis. But she's no longer giving a time table on when that will actually happen.>> I see good reasons to expect that the positive forces supporting employment growth and higher inflation will continue to outweigh the negative ones.
00:00:23
>> In her first public comment since learning employers slammed on the breaks on hiring in May making for the weakest month of job creation in more than five years, Yellen on Monday dropping any reference to a rate increase in coming months. That omission supporting the idea a rate hike won't be happening at the Feds meeting in mid June.
00:00:43
But that could be a problem according Reuters Feds reporter Johnathan Spicer who was at Yellen's lunch time speech.>> The Fed does run the risk, if it waits to long to pull off this policy technique, that it gets too close to that November US presidential election. A lot of people are saying that they may not want to wait until September, for example, to become perhaps a headline issue in what is expected to be a fairly testy campaign.
00:01:11
That's why Markets are still predicting a one in three chance of a summer rate hike. And a fifty-fifty chance of a September move. The Fed, however, has something else to worry about before that. Britain votes on whether or not to leave the Euro later this month. And Yellen wants to make sure financial markets are calm before making any more decisions.