Treasury Secretary Janet Yellen said on Monday she saw an opportunity to avoid a recession in the United States, with inflation falling significantly and the economy remaining strong, given positive labor market dynamics.
“There is no recession when a country has 500,000 new jobs and the lowest unemployment rate in over 50 years,” Yellen told ABC. “I see the possibility of a significant reduction in inflation as the economy remains strong.”
Inflation has remained too high but has come down over the past six months and could drop significantly given the steps taken by the Biden administration, including moves to reduce the cost of gasoline and prescription drugs, Yellen said.
Labor Department data released on Friday showed a sharp acceleration in job growth in January, with 517,000 nonfarm payrolls added and the unemployment rate falling to 3.4%, the lowest in 53 years.
Three separate laws – the Inflation Reduction Act, the CHIPS Act and the Infrastructure Act – will help bring inflation down, she said.
Yellen urged Congress to raise the national debt ceiling, warning failure to do so would lead to ‘economic and financial disaster’
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