Trump Budget won't necessarily prompt higher rates: Yellen

The Federal Reserve chief demurred on commenting on specific changes in the budget

Federal Reserve Chair Janet Yellen rejected suggestions that the central bank would respond willy-nilly to any changes in tax and spending plans by President Donald Trump with stepped-up increases in interest rates.

That’s “not quite accurate,” she told lawmakers on Wednesday when asked about a media report that the central bank would seek to offset changes in fiscal policy with alterations in its own stance.

“Only if we think that it is demand-based and threatens our inflation objective,” would the Fed react with a tightening of monetary policy, the Fed chief said. Appearing on Capitol Hill for a second day of hearings