Fed's Yellen says spillovers cannot be avoided

WASHINGTON, July 2 Wed Jul 2, 2014 12:23pm EDT

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WASHINGTON, July 2 (Reuters) - The Federal Reserve will seek to communicate clearly about the U.S. central bank's monetary policy but some impact on global markets and other countries is "unavoidable" in the interconnected financial system, Fed Chair Janet Yellen said on Wednesday.

"We will try to conduct our monetary policy, and to communicate about it ... in a manner that is understandable to financial markets to avoid the kinds of surprises that could cause jumps in interest rates, that could cause such capital flows," Yellen said at an event sponsored by the International Monetary Fund.

"To some extent, I think such spillovers are really unavoidable in a situation of global capital markets," she added. (Reporting by Anna Yukhananov; Editing by James Dalgleish)

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