US Federal Reserve chair Janet Yellen says the US economy is strong enough to bear an interest rates rise, giving a further hint that the central bank will move in December.
Yellen told Congress the US is reaching a point where it can handle an interest rate rise that will show “how far our economy has come in recovering from the effects of the financial crisis”.
The Fed is expected to raise rates at its next meeting on 15 and 16 December. The central bank has kept its short-term benchmark interest rate near zero since 2006.
Yellen said although the slowing global economy and a stronger dollar had had an impact on the US, consumer and business spending as well as housing investment are still strong.
She also expects the US economy to continue to experience “steady growth”.
However, US consumer spending in October rose just 0.1 per cent compared with September.
Additionally, US manufacturing fell in November, according to figures from the Institute for Supply Management, with its factory activity index dipping to 48.6 in November from 50.1 in October, meaning the market is contracting.