Federal Reserve Chair Janet Yellen said Thursday that the intense winter storms of the past two months have been one cause for the weakness in recent US economic data. "We have seen quite a bit of soft data over the last month or six weeks," she told a Senate panel, citing weaker numbers in the housing sector, retail sales, job creation and industrial production.
"It is clear that unseasonably cold weather has played some role" in that data, she said. But Yellen stopped short of saying whether the Fed would decide to halt the two-month-old process of cutting its stimulus program, now at $65 billion a month in bond purchases.
She said it was still "difficult to discern" what exactly is behind the soft data. "I wouldn't want to jump to conclusions" about whether the data will remain soft or whether in fact the severe cold in many parts of the country was the cause, she said. But if there is a significant change in the economic outlook from what the Federal Open Market Committee outlined in recent months, she said, the plan to taper the bond purchase program could be reconsidered.
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