POLITICS: PennAve

The week head in economics: Janet Yellen to the Hill, financial regulation and hiring

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Jobs,PennAve,Joseph Lawler,Economy,Federal Reserve,Janet Yellen,Unemployment,Taper,GDP

Federal Reserve Chairwoman Janet Yellen will appear before both the Joint Economic Committee on Wednesday and the Senate Budget Committee on Thursday to discuss the economic outlook.

That’s a topic of added interest after last week’s disappointing reading on gross domestic product for the first quarter of 2013, which showed growth nearly stalling out, at just 0.1 percent.

At a press conference in March, Yellen said zero growth would be an “extreme” situation, as far as the Fed’s plans for winding down its stimulus programs go — all that would be required for her to reconsider “tapering” the size of the Fed’s monthly bond purchases, she said, would be a lack of confidence that the labor market was improving and that inflation was rising toward the central bank’s goal of 2 percent.

Yet growth was almost zero, at least in the initial GDP report, which is subject to revision. In her Capitol Hill appearance, Yellen will surely get questions about whether she considers deviating from the Fed’s recent decisions to reduce the size of its monthly bond purchases by $10 billion each time.

On Wednesday, Treasury Secretary Jack Lew will head a meeting of the Financial Stability Oversight Council, the financial regulatory superbody, which likely will produce an update to the status of rulemaking related to the Dodd-Frank financial reform law.

On Friday, the Bureau of Labor Statistics will shed further light on the state of the labor market, and in particular the pace of hiring and firing, with its release of the Job Openings and Labor Turnover Survey for March. Last month, the number of job openings at the end of the month ticked above 4 million, and the number of total hires eclipsed 4.5 million — both improvements, but well off pre-recession levels.

Friday's jobs report, based on two different surveys, showed job growth picking up to 288,000 for April and the unemployment rate falling to 6.3 percent. For similar strong growth in months ahead, businesses will need to pick up the pace of hiring.

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