WASHINGTON — Federal Reserve Chair Janet Yellen said Thursday that the central bank did not make a mistake in boosting interest rates in December, a move that was followed by significant turbulence in financial markets and further weakening of the global economy.
Yellen said the U.S. economy remains on a solid course and that she “would not describe this as a bubble economy.”
The current head of the Fed appeared at an unprecedented gathering in New York with the three men who preceded her in the job — Ben Bernanke, Alan Greenspan and Paul Volcker.
She noted that in December, the Fed indicated the pace of future rate hikes would be gradual. That remains the Fed’s expectation, she said.
The central bank’s quarter-point move in December was the first rate hike in seven years, a period during which the benchmark rate was kept at a record low near zero. Many private economists think the next hike will not occur until June.
The four Fed leaders appeared at an event to launch a speaker’s program honoring Volcker at the International House in New York, a residential dormitory for foreign students. All but Greenspan, who took part by video link, gathered on site at the International House.
The tenures of the four participants cover more than one-third of the Fed’s 102-year history. They reflected on the pressures that come from holding what is arguably the most powerful economic policymaking job in the world.
