San Francisco Fed chief Yellen sees some bumps along the road but expect the economy to begin to grow again late this year or early next. Unemployment will continue to rise into 2010, she predicts while noting core inflation could stay below 1% for several years.
The one area where I strongly agree with Yellen is in her contention that fears that inflation will jump once the economy begins to recover are overblown.
EUR/USD has rebounded back into the 1.3560s as it seesaws through the afternoon.
