Janet Yellen did nothing to shock markets yesterday. In her first congressional appearance as the new Federal Reserve chairwoman, Ms Yellen confirmed what everyone thought: she is dovish on interest rates, will continue to taper off the Fed’s bond purchases unless something goes badly wrong and does not see emerging market turmoil as the Fed’s responsibility.

Still, her shift of focus away from headline unemployment – now just above the 6.5 per cent threshold set for reconsidering rates – reassured markets that she is as much of a dove as expected, and shares jumped. Equally, the commitment to tapering saw 10-year Treasury yields rise as much as 6bp near the end of her testimony, the most in a day this year.

Investors are hoping for a Goldilocks outcome for the US economy, with growth forecast to be solid, at close to 3 per cent this year, but inflation predicted to be just 1.6 per cent, according to the Consensus Economics survey. Investors think that low inflation means Ms Yellen can stay dovish even as economic growth delivers higher earnings and keeps the bears away.