The prospective chair of the powerful U.S. Federal Reserve, Janet Yellen, says the American economy is "significantly stronger" since the depths of the 2008 global financial crisis, but still needs support from the central bank.
Yellen spoke at her confirmation hearing Thursday before the Senate Banking Committee, where Republican critics of massive Fed financial support of the U.S. economy are looking to question her sharply about her past support of such policies. If confirmed by the full Senate, she would become the first woman to head the century-old Fed and replace Ben Bernanke when he leaves office in January.
Yellen said the American economy, the world's largest, has "made good progress" since the deep recession that was the country's worst in seven decades. She noted the economy has created 7.8 million new jobs since 2010 and the housing and auto industries have regained strength.
But the 67-year-old economist said the U.S. economy has "farther to go to regain the ground lost in the crisis and the recession," and to boost job growth.
"Unemployment is down from a peak of 10 percent, but at 7.3 percent in October, it is still too high, reflecting a labor market and economy performing far short of their potential."
When President Barack Obama nominated Yellen in October, she said many American workers suffered during the downturn, often laid off from long-time jobs as the economy weakened.
"Too many Americans still can't find a job and worry has not paid their bills and provided for their families."
Yellen said she believes continued Fed support for the economy "is the surest path" to recovery and a time when the central bank can withdraw its stimulus measures.
The central bank has been purchasing $85 billion a month in securities to pump money into the economy, but has said that as the economy recovers it will begin to cut that support and possibly end it by mid-2014. Policy makers could begin to trim the security purchases next month or wait for further indications that the economy is improving.