There are two major takeaways from Federal Reserve chair Janet Yellen’s testimony before a joint congressional committee on economic affairs; one she is here to stay, at least till her term ends and secondly, Fed is very much likely to move ahead with a rate hike in December.

She said that she intends to complete her full term that expires in early 2018 and stressed once again that it is critically important for the central bank to maintain its independence. She said, “Sometimes central banks need to do things that are not immediately popular for the health of the economy…….We’ve really seen terrible economic outcomes in countries where central banks have been subject to political pressure.” Her comments come in response to the worries that the newly elected President Donald Trump would influence the Fed to adopt a more hawkish regime. During the campaign, Mr. Trump accused the Fed of playing politics for the Obama administration by keeping interest rates at such low levels. She stressed that the outcome of the election hasn’t altered the outlook of Fed.

With regard to interest rates, she said that the Fed doesn’t intend to wait too long for the normalization. “Were the Federal Open Market Committee to delay increases in the federal funds rate for too long, it could end up having to tighten policy relatively abruptly to keep the economy from significantly overshooting committee’s longer-run policy goals,” she said. The next Fed meeting is scheduled at 13th-14th December and the financial markets are pricing more than 90 percent chance of a 25 basis points hike at that meeting.

The dollar rose to new 13-year high as she started speaking. The dollar index is currently trading at 101.2