United States

Given the strength of the U.S. labour market, U.S. Treasury Secretary Janet Yellen said on Monday that she sees a path to avoid a U.S. recession, with inflation falling significantly and the economy remaining strong.

“There is no recession when there are 500,000 jobs and the lowest unemployment rate in more than 50 years,” Yellen said on ABC’s Good Morning America.

“What I see is a path in which inflation falls significantly while the economy remains strong.”

Yellen stated that inflation remained too high, but that it had been falling for the past six months and could fall significantly given the Biden administration’s measures, such as steps to reduce the cost of gasoline and prescription drugs.

According to Labor Department data released on Friday,

United States
United States

Job creation accelerated sharply in January, with nonfarm payrolls increasing by 517,000 and the unemployment rate falling to a 53-1/2-year low of 3.4%.

The hiring surge, which occurred despite layoffs in the technology sector, reduced market expectations that the Federal Reserve of the United States was on the verge of pausing its monetary policy tightening cycle.

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Yellen told ABC that while lowering inflation is still Biden’s top priority, the US economy is proving “strong and resilient.”

Three separate pieces of legislation – the Inflation Reduction Act, the CHIPS Act, and a massive infrastructure law – would all help drive down inflation, she said, as would a price cap imposed on Russia oil.

United States
United States

Yellen urged Congress to raise the US debt ceiling, warning that failure to do so would result in “an economic and financial disaster.”

“While it has occasionally come down to the wire, it is something that Congress has always recognised as their responsibility.”

responsibility and must repeat.”

The United States reached its $31.4 trillion debt ceiling last month, prompting the Treasury Department to warn that it may be unable to avoid default beyond early June.

Republican House Speaker Kevin McCarthy and President Joe Biden met last week to discuss raising the debt ceiling and agreed to meet again, but the standoff has unsettled markets.

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