US economy to grow solidly after winter freeze - Yellen

Wednesday 07 May 2014 17.24
US Fed chief Janet Yellen says that labour market conditions 'are still far from satisfactory'
US Fed chief Janet Yellen says that labour market conditions 'are still far from satisfactory'

The US economy is on track for "solid growth" in the second quarter after the winter freeze, US Federal Reserve Chair Janet Yellen has said.

But with the housing industry slowing and unemployment still high, the economy still needs "a high degree of monetary accommodation," she told a US congressional committee. 

Yellen said the growth stall in the first quarter was "mostly reflecting transitory factors, including the effects of the unusually cold and snowy winter weather."

"With the harsh winter weather behind us, many recent indicators suggest that a rebound in spending and production is already under way," she said.

Yellen told the Joint Economic Committee of Congress that labour market conditions have improved "appreciably," but that they "are still far from satisfactory."

She said she expects economic activity to expand "somewhat faster" this year than last, helped by less fighting in Washington over government spending, improved household wealth, and firmer global economic growth.