Blackstone Executive Vice Chairman Tony James says he's less optimistic now than before that the U.S.-China trade war could be resolved, but even a smaller deal could help...World Economyread more
The massive market transformation this month that some on Wall Street called a "once in a decade opportunity" might have just been a one-off technical move because of taxes.Marketsread more
The Pentagon will deploy U.S. forces to the Middle East on the heels of the attack on Saudi Arabian oil facilities, United States Secretary of Defense Mark Esper announced...Defenseread more
CNBC did a deep dive through the most recent Wall Street research to find stocks that analysts say are underappreciated.Marketsread more
Shares of MasterCard are up 46% this year, and 1120% since 2011, getting a boost from the strong U.S. consumer.Investingread more
CNBC sat in on an "empathy training" at Amazon PillPack's Somerville offices, which is part of new hire orientation.Technologyread more
Trade with China is the 'big unknown' for the Federal Reserve as it decides how best to support the U.S. economy, says Council on Foreign Relations Director of International...Futures Nowread more
Lobbying experts said the visit is likely an attempt to be in lawmakers' ears as they consider legislation that would impact Facebook.Technologyread more
Yardeni Research's Edward Yardeni believes the U.S. economy is picking up steam.Trading Nationread more
Iran's audacious drone and cruise missile attack on Saudi Arabia's oil producing facilities has provided a critical test yet for the Trump administration's foreign policy. A...Politicsread more
Economic data have not necessarily been playing ball with the Fed's policy plans in recent weeks and have been mixed at best. While construction spending has risen, there has been a sharp downturn in the manufacturing surveys along with weaker retail sales.
The government's crucial monthly employment report is issued on Friday morning.
"Between today and the next FOMC meeting, we will receive additional data that bear on the economic outlook," Yellen told the Economic Club of Washington. "When my colleagues and I meet, we will assess all of the available data and their implications for the economic outlook in making our policy decision."
Separately on Wednesday, San Francisco Fed President John Williams said he preferred hiking rates sooner rather than later. In prepared remarks, he noted that if the Fed waits too long, it risks overshooting its inflation target or creating imbalances in the economy.
Starting normalization sooner also allows for a more gradual process, he said.
The next meeting of the Federal Open Market Committee is Dec. 15 and 16.
U.S. stocks were little changed on Yellen's comments, but currencies moved on the news. The euro at one point fell to a fresh 7½- month low against the dollar, and the yen slipped against the greenback. In fact, the dollar index hit highs of around 100.5 just after Yellen's prepared remarks were released, but it slipped below 100 throughout her speaking event.
The probability of a Fed rate hike in December held above 75 percent after Yellen's comments were released, according to CME's FedWatch tool.
The Fed chair, who gives her economic outlook to Congress on Thursday, said she sees continued growth sufficient to boost jobs and raise inflation. The job market, she added, is close to the Fed's maximum goal, but she can't yet declare full employment.
Job growth has been relatively strong, and Friday's employment report is expected to show that the economy added about 200,000 jobs in November. Data on Wednesday from ADP showed U.S. private employers added 217,000 jobs in November, up from the 196,000 in October. Economists polled by Reuters had expected an addition of 190,000 jobs.
Yellen said there has been "less progress," on the Fed's goal to boost inflation to 2 percent, but she forecast that drags will diminish next year.
Turning to the Fed's future rate decisions, Yellen said it will be appropriate to be more cautious on raising rates from near zero, and the Fed must take into account the lagging effects of its policy.
On the other hand, she said, if the Fed delays hikes too long, then it might have to tighten abruptly. The U.S. central bank, she explained, could inadvertently create a recession by waiting too long.
Even after the initial rate hike, the funds rate will be accommodative, Yellen said, adding that expectations for the path of the rate will be key to economic outlook.
During a question-answer session after the speech, Yellen said the Fed has no "predetermined" plan for rate moves after initial liftoff, and that policy will continue to depend on incoming data. "There is no plan to proceed over time in some mechanical or calendar-based way," she said.
Future decisions will not require unanimity among FOMC members, and dissent will continue to be tolerated, but Yellen said decisions need some amount of agreement.
"The FOMC is an organization that does not suffer from group-think," she said. "But nevertheless, I think for the FOMC to be successful and to communicate a coherent policy to the public, we do need a certain degree of consensus."
"When the committee begins to normalize the stance of policy, doing so will be a testament, also, to how far our economy has come in recovering from the effects of the financial crisis and the Great Recession," Yellen said at the conclusion of her speech. "In that sense, it is a day that I expect we all are looking forward to."
—Reuters and CNBC's Jacob Pramuk contributed to this report.