Good day. Janet Yellen pressed ahead in 2015 with the Fed's first interest rate increase in nearly a decade despite several colleagues’ misgivings over global economic weakness and weak inflation pressures, according to transcripts of the policy meeting released Friday. Also Friday, Fed Vice Chairman Richard Clarida said regarding the economy that “the welcome news on the development of several effective vaccines indicates to me that the prospects for the economy in 2021 and beyond have brightened and the downside risk to the outlook has diminished.”

Now on to today’s news and analysis.

Janet Yellen, who has been nominated by President-elect Joe Biden to serve as Treasury secretary, argued at the Fed's December 2015 meeting for raising short-term rates to slow hiring and pre-empt inflationary pressures that could require more aggressive rate increases later. “We would want to check the pace of employment growth somewhat to reduce the risk of overheating that could eventually force us to tighten abruptly,” she said. The decision to lift interest rates from near zero was approved unanimously by the rate-setting Federal Open Market Committee. But Ms. Yellen allowed for the risk that inflation dynamics weren’t operating as they had in prior periods, which is what transpired.

• Job Losses in 2020 Were Worst Since 1939
• This Could Be the Best Year on Record for Job Growth

• Businesses Brace for a Democratic Congress

12 p.m: Atlanta Fed's Bostic in a virtual discussion on the economic outlook with former Atlanta Fed president Dennis Lockhart
6 p.m.: Dallas Fed's Kaplan participates in a Dallas Fed Virtual Town Hall

9:35 a.m.: Fed's Brainard discusses artificial Intelligence and financial services at the Virtual Federal Reserve Artificial Intelligence Symposium
10 a.m.: U.S. Labor Department releases November Job Openings and Labor Turnover Survey
11 a.m.: Boston Fed's Rosengren joins Greater Boston Chamber of Commerce: 2021 Economic Overview virtual event; Boston Fed's Rosengren, Dallas Fed's Kaplan and Minneapolis Fed's Kashkari in virtual Racism and the Economy event series 
12 p.m.: Cleveland Fed's Mester joins European Economics and Financial Centre virtual event
1 p.m.: Kansas City Fed's George discusses economic and monetary policy outlook at virtual event hosted by The Central Exchange

Unified government under Democrats, locked in after the Atlanta Senate races, augers stronger growth, according to Michael Feroli, economist at JPMorgan Chase Bank NA. He expects to see another stimulus package just shy of $1 trillion and believes it will have a tangible impact on growth. If fiscal aid passes, along with other increases in government spending, growth this year would be about 1.5 percentage points higher than it would without the aid, at 5.3%, followed by 2.6% in 2022, Mr. Feroli said in a note to clients. "This would also leave the level of GDP at the end of 2022 above the pre-pandemic path that it was on," he added. Stronger activity could also push the Federal Reserve to start slowing its bond buying program this year, although in an appearance Friday, Fed Vice-chairman Richard Clarida said he expects to stick with $120 billion a month in bond buying for all of 2021.

—Michael S. Derby

• China's consumer price index rose 0.2% in December, rebounding from a decline in the prior month and beating the 0% growth predicted by economists polled by WSJ. (Dow Jones Newswires) 
• The eurozone’s jobless rate fell to 8.3% in November, from 8.4% in October, the fourth straight month it shrank even as a sharp rise in new coronavirus infections and tightened government restrictions led many businesses to reduce or suspend their services, the European Union’s statistics agency said. (DJN)
• The Dow Jones Industrial Average rose 1.6% for the first week of 2021, marking its fourth-straight weekly gain despite a mob storming the U.S. Capitol Wednesday and a decline in nonfarm payrolls reported Friday.
• A blast of cold weather in northeast Asia and a shortage of ships for transporting gas have sparked a scramble for cargoes of liquefied natural gas, igniting a steep rise in prices.
• Remittances sent home by Mexicans in the U.S. rose 11% to $36.9 billion in the first 11 months of the year, more than the record $36.4 billion sent in all of 2019, according to figures released by Mexico’s central bank. 
• Turkey's current-account deficit for November was $4.06 billion compared with a surplus of $518 million in November 2019, according to the central bank's data. (DJN) 
• Brazil's exports of beef increased 8% by volume to 2.02 million metric tons in 2020 from the year earlier, boosted by an increase in sales to China, according to Brazilian trade group Abrafrigo. (DJN)
• Mexico's production of cars and light trucks fell 20% in 2020 to just over 3 million units, mainly the result of shutdowns in April and May when output was practically nil, statistics institute Inegi said. (DJN)

This newsletter is compiled by James Christie in San Francisco and Ed Ballard in London. 

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