Schumer: I’m going to encourage Yellen to be careful with interest rates
Democratic Senator wants to know when taper will end
Tuesday is another big day for Federal Reserve Chair Janet Yellen. On Tuesday, Yellen goes before the Senate Banking Committee to discuss quantitative easing, amongst other Fed-related items.
Last week, the minutes of the June Federal Open Market Committee meeting revealed that the Fed is considering ending its taper of bond purchases in October.
In the mean time, the committee decided to continue to taper, and beginning in July, it will add to its holdings of agency mortgage-backed securities at a pace of $15 billion per month rather than $20 billion per month, and will add to its holdings of longer-term Treasury securities at a pace of $20 billion per month rather than $25 billion per month.
Yellen is set to testify before the Senate committee on Tuesday and Senator Charles Schumer (D-N.Y.) told MarketWatch what he plans to ask Yellen when she’s in the hot seat.
“The $64,000 question is how soon they end the quantitative easing and how quickly will they try to raise [interest] rates?” Schumer said in a brief telephone interview with MarketWatch on Monday.
Schumer said he believes the “overwhelming problem” still faced by the economy is the lack of job growth.
“So I am going to encourage [the Fed] to be careful before they move to raise rates,” due to the impact that could have on job growth, Schumer said.