WASHINGTON: Federal Reserve chair Janet Yellen went out of her way on Monday to stress that the US economy appears fundamentally solid.
The job market has rebounded. Consumer spending is picking up along with confidence. Higher home prices have lifted household wealth. Low energy prices have strengthened spending power.
Yet the Fed chair also sent a contrasting message in a speech in Philadelphia: So many uncertainties surround the economy that it’s impossible to sketch any timetable for when the Fed might raise interest rates again.
Thirteen times Yellen mentioned some variation of the word “uncertainty” starting with a question raised by a dismal jobs report the government issued Friday.
“Is the markedly reduced pace of hiring in April and May ,” Yellen asked, “a harbinger of a persistent slowdown in the broader economy?”
She didn’t claim to know the answer. The Fed, she said, “will be wrestling” with that question in the months ahead.
She said a key question is whether US demand can remain strong “amid fairly considerable global bumpiness” and cautioned that there is still cause for concern, particularly from China.