Yellen calls economy and job market still subpar

Yellen notes economy and job market remain subpar while inflation is below Fed's target

In a file photo dated Oct 9, 2013, Janet Yellen, vice chair of the Board of Governors of the Federal Reserve System, and President Barack Obama's nominee to be the next Federal Reserve chair, smiles as Obama speaks in the State Dining Room of the White House in Washington, where the president announced he is nominating Yellen to be chair of the Federal Reserve, succeeding Ben Bernanke. (AP Photo/Charles Dharapak)

WASHINGTON (AP) -- Janet Yellen says the economy has regained ground lost to the deepest recession since the 1930s. But she says unemployment remains too high at 7.3 percent and the Fed is trying to accelerate the recovery.

In testimony prepared for her confirmation hearing Thursday, Yellen says the job market and the economy are still performing far below their potential. And she notes that inflation is running well below the Fed's 2 percent target.

Yellen says that supporting the economy is the "surest path to returning to a more normal approach" to Fed interest-rate policies in the future. Her comments appear to be a signal that she favors continued use of the extraordinary support measures the Fed has been using to keep borrowing rates low.