Fed May Extend Support Past 2014, Official Says

11-Apr (The New York Times) — Janet L. Yellen, the vice chairwoman of the Federal Reserve, said Wednesday that the lackluster trajectory of the economic recovery might require the Fed to continue its efforts to bolster growth even beyond the end of 2014.

In a speech in Manhattan, Ms. Yellen offered a rejoinder to recent remarks by other Fed officials and investors warning that the Fed would need to raise interest rates well before the end of 2014 to prevent an increase in the rate of inflation.

She indicated that the Fed’s leadership, including the chairman, Ben S. Bernanke, remained firmly committed to the central bank’s efforts to suppress interest rates and reduce the cost of borrowing for businesses and consumers.

“I anticipate that the U.S. economy will continue to recover only gradually and that labor market slack will remain substantial for a number of years to come,” Ms. Yellen said, according to an advance copy of her prepared remarks.

She said that by some measures the Fed was not doing enough.


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