Fed's Yellen expects 3% growth

United States Federal Reserve Vice Chairwoman Janet Yellen, who takes the reins of the Fed on February 1, said in an interview with Time Magazine published Thursday that she expects to see a stronger US economy in 2014 and is hopeful of growth of at least 3 per cent.

"I think we'll see stronger growth this year. Most of my colleagues on the Fed's policymaking committee and I are hopeful that the first digit (of GDP growth) could be 3 rather than 2..," she said.

Ms Yellen, who was confirmed as Federal Reserve Chairwoman on Monday, also said she expects a housing market pick-up after a lull in the Fall.

"I expect it to pick back up and I do expect a further recovery."

Terming the recovery as "frustratingly slow", she said, however, "we're making progress in getting people back to work, and I anticipate that inflation will move back toward our longer-run goal of 2 per cent."

On the Fed's quantitative easing program, she said the policy is aimed at holding down long-term interest rates, which encourages spending.

"And part of the (stimulus) comes through higher house and stock prices, which causes people with homes and stocks to spend more, which causes jobs to be created throughout the economy and income to go up throughout the economy," she said.