Fed's Yellen

• Yellen says surprised by persistence of food, energy gains
• SHE WON'T GUESS WHEN RATE CUTS MIGHT REVERSE
• MUST TAKE BACK CUTS IN TIMELY MANNER AS GROWTH GAINS
• SHE'S STILL SURPRISED OIL PRICES SOARING
• WHAT MATTERS IS HEADLINE INFLATION
• IT WILL TAKE TIME TO GET BACK TO FULL EMPLOYMENT
• ANTICIPATES DECLINES IN PAYROLLS, WEAK JOB MARKET
• SECOND HALF GROWTH IMPROVEMENT WON'T BE ROBUST
• DOESN'T SEE NEED FOR SECOND ROUND OF FISCAL STIMULUS
• RISK OF REPEAT OF '70S INFLATION WOULD SPUR FED TO ACT
• SAYS FED CAN'T ALLOW REPEAT OF 1970S TYPE INFLATION
• WORRIED ABOUT RISK OF HOUSE PRICE DROP ROILING ECONOMY

• Fed has moved in an aggressive and timely fashion
• Emergency Rate Cut was to address fear on economy
• Spreads represent caution by banks on liquidity
• Sees disruptions in commercial real estate lending
• Market tensions have lessened however there is still tension in the money markets
• Slow growth is more probable than recession
• Fed must be focused on downside economic risk
• Fed must not be afraid to act due to moral hazard
• Increase in credit spreads have worked counter to the Fed's cuts

ANALYSIS: Ms.

Say:

• US will avoid a recession
• Sees slow growth in coming quarters
• Core Inflation to moderate in slowdown
• No quick fix for problems feeding into turbulent markets

Comments are similar to her comments made last week.

She is not a voting member of the Federal Open Market Committee (FOMC)