An interest rate hike “raises the cost of borrowing for businesses”, including the financing of “plant and equipment, new investment, and things that create jobs”.
The Reserve Bank of New Zealand is considered nearly certain to lower rates next week, while Australia’s central bank is still seen keeping an easing bias for now.
Yellen said the Fed was facing a delicate balancing act in achieving its dual goals of achieving maximum employment and stable prices.
But many GOP lawmakers were less than satisfied.
She was optimistic that inflation would continue to inch upward.
Jeb Hensarling, the Texas Republican who leads the Financial Services Committee, said the Fed had “crossed the line” by failing to provide the documents.
“There is not a central bank in the world that follows a rule that would rely on only two variables”, she said.
Wednesday, the USA dollar rose 0.59 percent against the euro, 0.15 percent against the Swiss franc and 0.41 percent against the yen.
European policymakers battling slow growth are lowering rates and buying bonds, even as Fed officials overseeing an expanding economy are nearing rate increases that make US assets relatively more lucrative for investors.
In early U.S. trading, the Dow Jones industrial average rose 5.64 points, or 0.03 per cent, to 18,059.22, the S&P 500 gained 1.92 points, or 0.09 per cent, to 2,110.87 and the Nasdaq Composite added 13.02 points, or 0.26 per cent, to 5,117.91. Waiting too long, on the other hand, might force the Fed to tighten at a faster pace to keep the economy from overheating.
The US dollar opened higher against the Taiwan dollar on follow-through buying, but soon dipped into negative territory in the wake of an initial technical rebound staged by the local equity market after the Greek parliament passed a bailout agreement signed with the country’s creditors, dealers said. She also cited “noticeable declines” over the past year in the number of long-term unemployed.
What would also help gold would be a revival in consumer demand. Analysts, however, forecast that the local currency’s weakness will not be of much benefit to exporters.
‘Equity markets giving a mixed reception to overnight Greek parliamentary approval of tough reforms for a third bailout and the ramp up of United States second quarter earnings season, ‘ said Mike van Dulken, head of research at Accendo Markets.
Yellen listed foreign developments as key uncertainties that could weigh on US growth.
The euro finished Thursday’s session just above a six-week low against the dollar reached after European Central Bank President Mario Draghi said the ECB had authorized a one-week, 900 million euro ($980 million) extension of Greece’s liquidity assistance program.