Yellen Outsources U.S. Monetary Policy to the Financial Markets

http://www.bloomberg.com/news/articles/2016-03-30/yellen-outsources-u-s-monetary-policy-to-the-financial-markets


The Federal Reserve looks to have outsourced monetary policy to the financial markets -- and that may not necessarily be bad.
Fed Chair Janet Yellen told the Economic Club of New York on Tuesday that policy makers had scaled back the number of interest rate increases they expect to carry out this year after investors did the same.
She argued that the downgrading of rate expectations in the market had led to lower bond yields, providing the economy with needed support in the face of weaker growth overseas. The Fed then followed suit this month by reducing its anticipated rate hikes in 2016 to two from four quarter-percentage point moves projected in December.