The US Federal Reserve will likely raise rates soon. US Fed chair Janet Yellen on Thursday told lawmakers incoming economic data justified a rate hike "relatively soon."

Fed may raise rates soon as prospects improve

She said inflation is heading back to 2 percent. She also pledged to serve out her term, which ends in 2018.

President-elect Donald Trump during his campaign said he wants someone in favor of keeping interest rates low as the head of the US central bank.

Yellen said the Fed would change its forecasts as necessary as the new administration rolls out plans for perhaps hundreds of billions of dollars in tax cuts and additional government spending.