Federal Reserve chair Janet Yellen said on Tuesday the bank will continue to cut its stimulus measures for the US economy.
Federal Reserve chair Janet Yellen. Photo: Getty Images / AFP
If the economy keeps improving, the bank would take "further measured steps" to reduce its support, she said.
In her first comments since taking over this month, Ms Yellen also signalled that interest rates would remain low.
The BBC reports her testimony signals a continuation of the policies started under her predecessor, Ben Bernanke.
"I have always been in favour of a predictable monetary policy that responds in a systematic way to economic variables," said Ms Yellen in response to questions from House Financial Services Committee chairman Jeb Hensarling.
While Ms Yellen noted the recent volatility in global financial markets, she said that at this stage it did not "not pose a substantial risk to the US economic outlook".
Ms Yellen also said there had been an improvement in the domestic jobs market, but added that the recovery was "far from complete".
While the US jobless rate had fallen, it still remained "well above levels" the Fed saw as consistent with maximum sustainable employment, she said.
She said that in assessing the health of the labour market, it was important to consider "more than the unemployment rate".
The unemployment rate has fallen to 6.6%, down from 7.9% a year ago, but the past two months have seen weak jobs growth, which Ms Yellen said had surprised her.
"Since the financial crisis and the depths of the recession, substantial progress has been made in restoring the economy to health," said Ms Yellen. "Still, there is more to do."
Many economists expect that the Fed's bond buying programme will be cut in $10bn (£6.1bn) monthly steps until purchases are eliminated.
The bond purchases were running at $US85 billion per month until December, since when there have been two reductions taking the figure to $US65 billion per month.
