However, she listed inflation as one of the uncertainties the economy is facing. Mainland China markets were mixed, with the Shanghai Composite trading higher by 0.08%, but the Shenzhen Composite was just below the flat line. Technology shares also rose sharply, with the tech index also up 1.3 percent.
Yelle noted the economy added 180,000 jobs per month during the first half of this year – almost the same pace as last year’s first half.
NerdWallet daily mortgage rates are an average of the published annual percentage rate with the lowest points for each loan term offered by a sampling of major national lenders.
“Our data suggests that U.S. inflation is actually picking up again”, said Bart Wakabayashi, branch manager for State Street Bank and Trust in Tokyo.
The Nasdaq is up 108.09 points, or 1.8 percent.
The United States is benefiting from other countries’ stronger growth.
In what she acknowledged could be her last appearance before Congress Ms Yellen predicted that the USA economy would continue to grow over the next few years, allowing the central bank to continue raising interest rates. On Friday, reports from three of the biggest USA banks – JPMorgan Chase, Wells Fargo and Citigroup – are expected.
“G$3 rowth in household spending, which was weak earlier in the year, has picked up in recent months and continues to be supported by job gains, rising household wealth, and favorable consumer sentiment”, she said in the remarks.
The rest of the session offers plentiful economic news, notably initial U.S. jobless claims, Canadian new home prices and the Bank of England’s look at credit conditions. These holdings were built up after the recession to unprecedented levels as the central bank tried to spark the economy by keeping a lid on interest rates. Inflation goes up when the economy is doing well.
Paul Ashworth, chief economist at Capital Economics, says it makes sense for Yellen to keep her options open, giving the Fed time to assess more economic data before making its next move.
But Yellen once again expressed the view held by many U.S. central bankers that the low pace of price increases is “partly the result of a few unusual reductions in certain categories of prices”, such as cell phone service and prescription medicines.
As part of its monetary policy normalization process, the Fed is going to reduce its 4.5-trillion-dollar balance sheet. She is due to address a Senate committee on Thursday too but observers don’t expect anything more dramatic to emerge.