US Treasury Secretary Janet Yellen admits that there is a risk of a recession in the US economy.
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US Treasury Secretary Janet Yellen
US Treasury Secretary Janet Yellen said today, Sunday, that “US economic growth is slowing”, and acknowledged the existence of “the risk of a recession,” adding that “a recession is not inevitable.”
Yellen told NBC that the strong US employment numbers and consumer spending showed that “the US economy is not in a recession right now.”
The significant rise in employment numbers in the United States in June continued, providing 372,000 jobs, and the unemployment rate stabilized at 3.6%. This was the fourth consecutive month that the number of new jobs exceeded 350,000.
Yellen, who previously chaired the US Federal Reserve, noted that the current economy “is not in a recession … but the country is in a transition period in which growth is slowing, and this is necessary and appropriate.”
and considered thatTo inflation “too highand that the latest interest rate increases are helping to rein in prices and bring them under control,” she said, adding: “I’m not saying that we will definitely avoid a recession…but I think there is a path that keeps the labor market strong and leads to lower inflation.”
US gross domestic product shrank at an annual rate of 1.6 percent in the first quarter, and Thursday’s report is expected to show a rise of just 0.4 percent in the second quarter, according to economists polled by Archyde.com.
The US Treasury Secretary pointed out that “even if the second quarter numbers are negative, this will not indicate a recession due to the strength of the labor market and increased demand,” adding that “the recession is a widespread weakness in the economy, we do not see that now.”
The US Federal Reserve hopes that it will once once more be able to slow inflation, without causing an economic contraction, while awaiting its approval. Significant increase in key interest ratesHowever, balancing the two approaches will be a delicate process.
This comes following US Federal Reserve Chairman Jerome Powell warned a few days ago that “the severity of inflation clearly surprised the monetary authorities,” warning of “the possibility of other surprises.”
and saw US Treasury Secretary Janet Yellenon Tuesday, that “the US economy is facing a number of global risks.”
