YELLEN: It's too soon to tell how Trump will influence the Fed
On the campaign trail, Trump was critical of Yellen and her monetary policy approach. He had said she kept interest rates low as a political favor to President Barack Obama.
Many questions from reporters were about how Trump's fiscal policy plans, which involve heavy infrastructure spending and tax cuts, influenced the Fed's forecasts and could affect decision-making going forward.
Yellen said it was too early to judge how fiscal policy would affect Fed policy, but that members of the Federal Open Markets Committee discussed this during their meeting.
When asked about the effect of Trump's tweets on corporate behavior, Yellen said she would not advise him on how to conduct himself on policy.
Yellen said she recognized that she may not be reappointed as Fed chair at the end of her term in 2018. That could happen if the new administration remains in disagreement with her steady approach to monetary policy.
"It's a decision I don't have to make and don't have thoughts on at this time," Yellen said.
If economic growth and inflation take off amid Trump's fiscal policy, the Fed may review its trajectory for interest rates and forecasts for growth. However, its outlooks for growth, inflation, and unemployment were largely unchanged from September, suggesting it was not as bullish as some economists have been since the election.
A vote of confidence
The FOMC raised the benchmark fed funds rate by 25 basis points, to a range of 0.50% to 0.75%.
By raising rates, "my colleagues and I are recognizing the considerable progress the economy has made towards our dual objectives of maximum employment and price stability," Yellen said.
"We expect that the economy will continue to perform well, with the job market strengthening further and inflation rising to 2% over the next couple of years," she added.
The Fed raised its expectation for the number of rate hikes for next year from two to three. Yellen characterized the change in expectations as a "very tiny" shift.
She addressed some Americans' concerns about the effect of rising rates on their personal finances. Mortgage rates, for example, have already increased and may continue to rise. The rate hike "should be understood as a reflection of confidence in economic progress and our judgment that that progress will continue," Yellen said. She added that there would be a modest effect from higher rates in the coming year.
Yellen declined to comment on the level of stock prices, which are near all-time highs. She said the rates of return on stocks remained within normal levels.