Janet Yellen is eyeballing wages for signs of inflationary pressure. She doesn’t see any so far.
“Wage gains continue to proceed at a historically slow pace in this recovery, with few signs of a broad-based acceleration,” the Federal Reserve chair said yesterday in her her first major monetary-policy framework speech.
Yellen said in response to a question from Harvard University economist Martin Feldstein that she expects people who have been out of work for a long time to return to the labor force as job prospects brighten. That will keep a lid on wages and inflation.
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