Janet Yellen defends US regulations

Federal Reserve Board Chairwoman Janet YellenImage copyright
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Federal Reserve Chair Janet Yellen defended financial rules introduced to the US after the 2008 financial crisis at a widely anticipated speech in Wyoming on Friday.

Her words come as the Trump administration has said it hopes to roll back some banking rules.

Ms Yellen said the bank was open to changes but they should remain modest.

European Central Bank President Mario Draghi is also scheduled to speak.

“The evidence shows that reforms since the crisis have made the financial system substantially safer,” Ms Yellen said in her remarks.

Critics, who include many prominent Republicans, say the banking regulations have hurt economic growth and limited lending.

Ms Yellen, whose term is due to expire early next year, rejected those arguments, while conceding that some areas could be improved.

The Federal Reserve is looking at changes to ease regulations for smaller banks, she said.

There may also be benefits to modifying the so-called Volcker Rule, which limits the ability of large banks to trade with their own money, she added.

But Ms Yellen cautioned against any sweeping rollback: “The balance of research suggests that the core reforms we have put in place have substantially boosted resilience without unduly limiting credit availability or economic growth.”

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