The nominee to chair the Federal Reserve will be questioned by the Senate Banking Committee on Thursday, at a time when markets have changed their tune on when the central bank may start reducing its bond purchases.
Yellen has never been in a hurry to taper, but the jobs data released Friday offer some food for thought.
Friday, a Labor Department report showed the economy added more jobs than forecast last month, boosting bets the Federal Reserve will reduce stimulus. The payrolls grew by 204,000 in October, versus the median forecast for a 130,000 advance.
Over the last year, jobs growth has averaged 194,000 per month. To be sure, the 7.3% unemployment rate is still high, but is it high enough to warrant the extra accommodation provided by the central bank’s $85 billion-per-month in asset purchases? That’s what the market wants to know from her confirmation hearing.
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