The index continues to remain firmly in positive territory, indicating the readiness of the economy for a policy move (see graph). In fact, the preliminary read on the Yellen Index improved from +0.54 to +0.65 with revisions.
Furthermore, momentum remains in positive territory and the level of the index is consistent with substantially reduced labor market slack. Indeed, the Index is consistent with a Fed that can raise rates in June.
Wage and employment data from U.S. Bureau of Labor Statistics.
Rick Rieder, Managing Director, is BlackRock’s Chief Investment Officer of Fundamental Fixed Income, is Co-head of Americas Fixed Income, and is a regular contributor to The Blog. You can find more of his posts here.