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Janet Yellen reiterated on Wednesday that it is “too early” to gauge the potential impacts of the fiscal policies that have been proposed by the Trump administration.

President Donald Trump has promised business tax cuts and a large infrastructure spending programme, something that economists reckon could cause a pick-up in US growth and inflation.

Ms Yellen said that there remains “great uncertainty” over the potential policies. The central bank chief said that Wednesday’s rate increase was based on current information, and was not a “preemptive response” to future policy moves.

Still, she said that some policymakers had “penciled in” potential fiscal changes in their economic projections.

Ms Yellen added that she had held a “brief” meeting with Mr Trump. She had also met several times with Treasury secretary Steven Mnuchin and “expects to have a strong relationship” with him.

Copyright The Financial Times Limited 2017. All rights reserved.
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