Janet Yellen, the Federal Reserve Chair confirmed on Capitol Hill that there might another interest rate hike this year. The unemployment rate in the US is getting to the lowest point of 5.3 percent considering the last seven year’s stats. For the whites, the unemployment rate was 4.8 percent, while for the Hispanics it was 6.6 percent.
According to Yellen, “Efforts to further increase transparency, no matter how well intentioned, must avoid unintended consequences that could undermine the Federal Reserve’s ability to make policy in the long-run best interest of American families and businesses.”
Greg Moore, the senior currency strategist at RBC Capital Markets, wrote a note to his clients that said the rate hike makes a lot of sense and it is greatly attributed to the rise in dollar rate.
The great recession ended in June 2009 but it left an ample of people unemployed for long spells. The minority groups were the ones under the stick of recession the most.
The Canadian dollar was at C$ 1.2940 per US dollar after reaching the point of C$ 1.2958, which is the lowest it has reached since March 2009. As a result, The Bank of Canada reduced the interest rates for the second time this year.
Yellen added, “The situation in Greece remains hard. Will the normalization of asset allocations (especially involving less liquid securities) that accompany the Fed’s interest rate normalization process (even one with a very gradual increase) be so “large and lumpy” as to overwhelm current market making capabilities?”
On Wednesday, Yellen is supposed to testify before the Senate banking Committee. If the rate increase gets through, it would be the first since the year 2006.
According to Republican Sean Duffy, R-Wisconsin, “If anyone is trying to sweep this under the rug, it is the Fed”.
Yellen is said to have been withholding a few documents on the advice of the Fed Inspector general with a strong reason stating that turning the material over could jeopardize an on-going investigation.