The Federal Reserve is “approaching a crossroads” on monetary policy and needs to “carefully” monitor developments and be ready “to act as needed to fulfill our mandate for sustainable economic growth and price stability,” Federal Reserve Bank of San Francisco president Janet Yellen said yesterday.

“We cannot and will not allow a wage-price spiral to develop,” she told the University of California San Diego Economics Roundtable, according to prepared text of the speech released by the Fed.

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