Federal Reserve's Yellen admits disappointment over

her exit in rare interview

businesstimes.com.sg/government-economy/federal-reserves-yellen-admits-disappointment-over-her-exit-in-rare-
interview

Outgoing Federal Reserve Chair Janet Yellen departs at the end of a news conference, her
last planned public remarks as Fed Chair, after a two-day Federal Open Market Committee
(FOMC) meeting in Washington, US, December 13, 2017.

PHOTO: REUTERS

[WASHINGTON] Federal Reserve Chair Janet Yellen professed her disappointment over
not being tapped for a second term by President Donald Trump, as she also predicted the
central bank would keep on it's path of gradual interest-rate increases.

"I would have liked to served an additional term and I did make that clear, so I will say I was
disappointed not to be reappointed," she said on Friday on the PBS NewsHour programme
in a rare television interview.

In her last day on the job, Ms Yellen added, "I feel great about the economy, I think things
are looking very strong." "The Federal Reserve has been on a path of gradual rate
increases and if conditions continue as they have been, that process is likely to continue,"
she said.

In a break from past practice, Mr Trump opted not to nominate Ms Yellen to a second four-
year term. Instead, he chose fellow Republican Jerome Powell to head the central bank.

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Earlier on Friday, the Brookings Institution announced Ms Yellen is joining the Washington-
based think tank to continue her economic studies and particularly her analysis of the
labour market. Mr Powell is to be sworn in as chair on Monday, February 5 at 9am.

SEE ALSO: Janet Yellen, Fed's first woman chair, gets emotional farewell
LABOUR MARKET GAINS

Ms Yellen said gains in the labor market had begun to benefit "almost all groups in the
American economy" and she expected the pace of wage growth to move up, but perhaps
not dramatically.

"Ultimately it's limited by productivity growth, which is weak," she said.

During Ms Yellen's four-year term, unemployment fell to 4.1 per cent, from 6.7 per cent
when she took office.

The January reading, released earlier Friday, matched the lowest since 2000 and was
below the level that most economists - including those at the Fed - reckon is equivalent to
full employment.

Inflation, though, has consistently fallen short of the Fed's 2 per cent objective during Ms
Yellen's tenure and stood at 1.7 per cent in December, according to the Fed's favourite
price gauge.

Ms Yellen and her fellow policy makers said this week that they expect inflation to rise this
year and to hit their target "over the medium term."

Notwithstanding this week's rout in the stock market, investors have prospered during Ms
Yellen's time atop the central bank. Since she took control in February 2014, the Dow
Jones Industrial Average has risen by more than 65 per cent.

As Fed chair, Ms Yellen began the process of exiting from the extraordinary measures that
the Fed put in place during the financial crisis and its aftermath, gingerly lifting interest rates
from near zero per cent and slowly scaling back the central bank's big holdings of bonds.

Ms Yellen's exit marks the end of more than 15 years of public service in two stints at the
central bank. She first served as a governor under Chairman Alan Greenspan in 1994 to
1997. She returned as president of the San Francisco Fed in 2004, became vice chair in
2010 and chair in 2014.

BLOOMBERG

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