Saturday, May 23, 2015Saturday, May 23, 2015

Fed chief Janet Yellen: US labour market 'has yet to fully recover'

Published on Aug 22, 2014 10:45 PM
A woman helps a job seeker as she looks for job opportunities on the computers at CareerSource Florida on Aug 1, 2014 in Miami, Florida. -- PHOTO: AFP

WASHINGTON (AFP) - United States Federal Reserve chief Janet Yellen said on Friday that the US jobs market has not yet fully recovered, but acknowledged that data is sending mixed signals, spurring debate over inflationary pressures.

In a speech to leading central bankers in Jackson Hole, Wyoming, Ms Yellen, who has kept Fed policy expansive due to perceived excess slack in the jobs market, admitted that analysing the data has been "especially challenging recently".

Yet, despite the sharp fall of the jobless rate to 6.2 per cent, she said there still remains "considerable uncertainty about the level of employment". She noted the arguments of a rising number of so-called inflation hawks that the decline in unemployment and some other data suggest mounting pressure on wages and prices that could accelerate inflation.

But she said that the combined data that the Fed is reviewing "suggests that the decline in the unemployment rate over this period somewhat overstates the improvement in overall labor market conditions". "Five years after the end of the recession, the labor market has yet to fully recover," she added.