Waiting too long to raise interest rates would be "unwise" as economic growth continues and inflation rises, Fed Chair Janet Yellen told Congress on Tuesday.
Global market experts believe although there are definite chances of a rate hike before 2016 ends, it would not rattle the emerging market space. However, short-term there could be some hurdle for the emerging markets (EMs).
In testimony before Congress that expressed general optimism about the economy and played down the risk of a recession, Yellen nevertheless said the Fed will be cautious about interest rate increases until it is clear the job market is holding up.
The Fed has held its overnight lending rate for banks at a target range of between 0.25 and 0.50 percent since it lifted the benchmark interest rate for the first time in a decade from near zero last December.
Stocks in the US closed higher, led by gains in tech stocks, after Fed Chair Janet Yellen said it is appropriate for policymakers to proceed 'cautiously.'
Sarah Hewin, Senior Economist, Standard Chartered, says the Fed did not talk about balance of risks to growth and did not raise the inflation forecasts, which showed they may not be preparing for rate hike anytime soon.
Recent indications provide at least some hope that inflation is edging toward the US central bank's 2 percent goal. That's the level Fed Chair Janet Yellen and the Federal Open Market Committee believe the economy should hit or least be on course toward.
Economic fundamentals remain strong despite the recent tumult in financial markets that has led to rising expectations of a recession, Cleveland Fed President Loretta Mester said Friday.
The Fed chair is in a tight spot, with markets wary of Fed policy to normalize rates, while other major central banks have turned to increased easing and even negative interest rates. She begins speaking before the House Committee on Financial Services at 10 am ET Wednesday. Her comments will be released at 8:30 am ET.
After pricing in RBI policy and GDP data - both were in line with market expectations - going ahead the market will closely watch GST Bill and Federal Reserve Policy meet.
Investors digested European Central Bank policy and Fed rate hike fears post comments from the Fed chair Janet Yellen. Banking & financials, FMCG, IT and auto stocks pulled the market down.
Yellen spoke after the market close Thursday in a much awaited speech that traders had hoped would clarify the central bank's position on rate hikes, after last week's FOMC meeting and a week of volatile markets. Stock traders covered shorts ahead of the 5 pm ET speech, expecting Yellen might give the market a boost.
Asian shares outside Japan mostly rebounded early Friday, recovering from early losses after the Federal Reserve cited concerns about global economic growth in its decision to hold off on its first rate hike in nearly a decade.
US markets closed lower as investors weigh higher bond yields and oil prices ahead of Friday‘s important jobs report.
Stocks rose after the Federal Reserve retained the phrase "considerable time" in its policy statement, and also introduced another word, "patient," as the central bank readies to raise interest rates next year.
On Wednesday, the Federal Open Market Committee ends its two-day review and traders are bracing for an increasingly hawkish tone from Fed Chair Janet Yellen.
Minutes of the Federal Reserve's most recent meeting of its policy-setting committee will be published on Wednesday, the second trading day of a holiday-shortened week in the United States. The US stock market will be closed on Monday for Presidents Day.
All eyes are on Fed chair Janet Yellen's first testimony before Congress on Tuesday, as investors attempt to predict whether the well-known dovish economist will continue tapering at USD 10 billion a month or pause following a string of weaker-than-expected data.
Two policymakers, Chicago Fed President Charles Evans and Richmond Fed President Jeffrey Lacker, disagreed on how long rates should stay low.