Yellen Says Economy Is Robust, but Adds That Fed Will Stay Flexible<br />Representative Jeb Hensarling, the Texas Republican who heads the committee, gave Ms. Yellen an unusually warm reception for the opposite reason, applauding the Fed for moving ahead with rate increases<br />and describing the Fed’s plans to start reducing bond holdings later this year as “more good news.”<br />These biannual hearings can be combative, but steady economic growth<br />and the Fed’s commitment to a retreat from its stimulus campaign have drained some of the tension from recent sessions.<br />Ms. Yellen, in her opening remarks on Wednesday, said growth had picked up after<br />a slow start to the year on stronger consumer spending and business investment.<br />Ms. Yellen said the Fed was keeping a close eye on the latest inflation data,<br />but she reiterated the Fed’s position that it expected prices to start rising more quickly.<br />Asked whether her appearance before the House committee on Wednesday might be her last, Ms. Yellen responded, “It may well be.”<br />The hearing also gave members of both parties a chance to talk about Mr. Trump.<br />Average hourly compensation including benefits rose 2.25 percent during the 12 months ending in March,<br />the Fed said in a biannual policy report to Congress that coincided with Ms. Yellen’s testimony.<br />“We’re watching this very closely and stand ready to adjust our policy if it appears the inflation undershoot will be persistent.”<br />Ms. Yellen’s testimony before the House Financial Services Committee lifted stock prices and lowered bond yields on Wednesday.
