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Federal Reserve Chair Janet Yellen warned Wednesday that the US economy faced risks from tightening domestic financial conditions as well as global economic turmoil. "These developments, if they prove persistent, could weigh on the outlook for economic activity and the labor market," she said, according to the prepared text. The sharp fall in commodity prices -- which she linked in part to "uncertainty" about China's economy and its policies -- threatened to "trigger financial stresses" in commodity-exporting countries and companies.
Tightening financial conditions driven by falling stock prices, uncertainty over China and a global reassessment of credit risk could throw the U.S. economy off track from an otherwise solid course, Federal Reserve Chair Janet Yellen said on Wednesday in prepared testimony to Congress. In testimony that combined a steady-as-she-goes account of Fed policy with an acknowledgement of intensifying risks, Yellen said there are good reasons to believe the United States will stay on a path of moderate growth that will allow the Fed to pursue "gradual" adjustments to monetary policy.