Janet Yellen, chair of the Federal Reserve, called for more U.S. interest rates hikes if the economy remains on its current growth trajectory. Yellen also revealed that she intends to complete her term at the helm of the Fed that ends early next year.

Yellen, during prepared remarks before the U.S. Senate Banking Committee Tuesday said that "gradual increases in the federal funds rate will likely be appropriate ... [and] will rise somewhat over time." She added, "The economic outlook is uncertain, and monetary policy is not on a preset course."

Next, Yellin next deliver a semiannual report on the Fed's monetary policy before the U.S. House Financial Services Committee. The two days of discussion mark the first time she has testified since Trump became president. (See also: Janet Yellen: Background and Philosophy.)

Among the strongest signs of U.S. economic health, Yellen pointed to strides in the labor market, which gained on average 190,000 per month in the second half of 2016, and improvement in the unemployment rate, which was 4.8 percent in January.

"Consumer spending has continued to rise at a healthy pace, supported by steady income gains, increases in the value of households' financial assets and homes, favorable levels of consumer sentiment, and low interest rates," Yellen said. "Last year's sales of automobiles and light trucks were the highest annual total on record."

The Federal Open Market Committee, which raised interest rates by a quarter of a percentage point in December, next meets March 14 to 15.

Some Republican lawmakers are likely to see the two days of testimony as a chance to continue promoting their case for deregulation at a time when three upcoming openings on the Central Bank’s seven-member board provide an opportunity for Trump to reshape the Fed. Daniel Tarullo, the Fed's top regulator, recently submitted his resignation for April 5; Yellen’s term expires in Feb. 2018; Fed Vice Chairman Stanley Fischer’s term expires in 2019. (See also: Fed Official’s Departure Creates Opening.)

Along with promoting deregulation, Trump has vowed to make significant tax cuts and increase spending on defense. (See also: Three Finance Stocks to Benefit from Tax Plan.)

“It’s a difficult situation for the Fed to be in,” Paul Ashworth, chief U.S. economist at Capital Economics in Toronto told Bloomberg. “There’s not much Yellen can do, because she’s got to wait and see what’s in the fiscal plan and if it gets a favorable response in Congress.”

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