Federal Reserve Chair Janet Yellen has announced today that the U.S. central bank remains on track to raise interest rates this year.

Her semi-annual testimony stated that with labour markets expected to steadily improve and turmoil abroad unlikely to throw the U.S. economy off track.

However, she went on to say that measures “continue to indicate that there is still some slack in labor markets. For example, too many people are not searching for a job but would likely do so if the labor market was stronger.

Although there are tentative signs that wage growth has picked up, it continues to be relatively subdued, consistent with other indications of slack. Thus, while labor market conditions have improved substantially, they are, in the FOMC’s judgment, not yet consistent with maximum employment.”

She concluded that inflation continues run lower than the Fed’s objective, but “we continue to anticipate that it will be appropriate to raise the target range for the federal funds rate when the Committee has seen further improvement in the labor market and is reasonably confident that inflation will move back to its 2 percent objective over the medium term.”

Her written statement to the committee is to be followed by a hearing later.