Fed Chair Janet Yellen re-inforced already growing expectations that the central bank would raise interest rates at its next meeting in December. Bobbi Rebell reports.
December is a "live possibility" for a rate hike, according to Fed Chair Janet Yellen, who testified before the House Financial Services Committee. Yellen focusing on the improving economic picture. SOUNDBITE: JANET YELLEN, CHAIR, U.S. FEDERAL RESERVE (ENGLISH) SAYING: "At this point, I see the U.S. economy as performing well. Domestic spending has been growing at a solid pace, our trade performance net exports is soft, but the committee judged in October that some of the downsides had diminished relating to global economic and financial developments." Yellen added that rates would only go up gradually from there. Stocks fell on the comments, despite the fact that the Fed has been talking about raising rates for a very long time. Manhattan Venture Partners' chief economist Max Wolff: SOUNDBITE: MAX WOLFF, CHIEF ECONMIST, MANHATTAN VENTURE PARTNERS (ENGLISH) SAYING: "This is the world's most telegraphed punch, and, so far, it hasn't even grazed anyone's chin. That being said, we know it's coming, and, I think, that chairman Yellen did a pretty good job today of making sure that people don't blow off the prospect of December." That seems unlikely. Investors have now raised their expectations for a December hike to around sixty percent. The December meeting is on the 15th and 16th, giving the Fed six more weeks of data, including two jobs reports, to look at before then.