Treasury Secretary Janet Yellen DENIES economy is in recession but admits it’s ‘slowing down’
Treasury Secretary Janet Yellen DENIES economy is in recession but admits it’s ‘slowing down’: Biden official says 9.1% inflation is ‘too high’ but ‘signs’ of a downturn aren’t there
- Treasury Secretary Janet Yellen said the economy slowing down was ‘necessary and appropriate’ for its longterm health during a Meet The Press interview
- The Biden official was asked if Americans should be ‘preparing’ for a recession
- It comes as the economy becomes a growing problem for Democrats heading into November’s midterm elections
- President Biden also called the inflation rate too high but said the data was ‘out of date’
- Yellen and Biden met with the president’s other economic advisers on Friday
Treasury Secretary Janet Yellen conceded that the economy is ‘slowing down’ on Friday amid fears of a looming financial downturn – but denied the country was in the midst of a recession.
She also defended the slowdown as ‘necessary’ in the longterm health of the economy.
The senior Biden official was asked on NBC News’ Meet The Press whether Americans should be ‘preparing’ for a recession.
Yellen did not directly rule it out in the future but insisted the ‘signs’ of a typical recession were not present in today’s economy.
Americans’ pocketbooks have been a growing concern for Democrats as the midterm elections loom against the backdrop of multiple polls indicating voters are unhappy with how the economy is being run.
‘The economy is slowing down. Last year it grew very rapidly at about 5.5 percent, and that succeeded in putting people back to work who had lost their jobs during the pandemic,’ Yellen said on Sunday.
She also pointed to impressive gains in the jobs market in recent months – despite data from late last week that indicate even that may be slowing down as unemployment claims grow.
‘This is not an economy that’s in recession, but we’re in a period of transition in which growth is slowing, and that’s necessary and appropriate, and we need to be growing at a steady and sustainable pace,’ Yellen said.
Treasury Secretary Janet Yellen said the ‘signs’ of a recession were not present in today’s economy
‘So there is a slowdown and businesses can see that, and that’s appropriate given that people now have jobs and we have a strong labor market.
‘But you don’t see any of the signs now – a recession is a broad based contraction that affects many sectors of the economy. We just don’t have that.’
Metrics like consumer spending, industrial output and credit quality remain above recession levels, Yellen explained.
Though she commiserated with the burden that surging prices have had on those consumers.
‘Inflation is way too high and you know the [Federal Reserve] is charged with putting in place policies that will bring inflation down, and I expect them to be successful,’ she said.
The most recent inflation data shows the average cost of consumer goods rising 9.1 percent in June, according to the Labor Department, the highest level seen since 1981.
President Joe Biden conceded the number was unacceptable but insisted the figure was ‘out of date’ and did not include the steady decline in gas prices seen this month.
Inflation in the U.S. rose to 9.1 percent in June, the highest since 1981 and above what economist had predicted
President Joe Biden virtually attends a meeting with his economic team in the South Court Auditorium on the White House complex in Washington, Friday, July 22
Prices at the pump have been steadily declining after reaching a record-high average of $5 per gallon in mid-June.
As of Sunday, the nationwide average price was roughly $4.37 as of Sunday, July 24. That’s still more than a dollar above the average price of July 2021.
Biden held a meeting of his economic advisers on Friday, including Yellen, on how to further lower gas prices.
He touted measures like releasing oil barrels from the US strategic petroleum reserve while renewing calls for energy companies sitting on unused drilling permits to use them or lose them.
Biden officials have also been using sky-high energy prices to accelerate the national transition to clean energy, which they argue is the most permanent solution to the costs.
‘In the days and weeks ahead, I’m going to keep doing what I can to bring down the price of gas at the pump,’ the president said on Friday.
‘But the real answer is to get to a clean energy economy as soon as possible; turn this into something positive. That means cleaner renewable energy, more affordable electric vehicles, and clean energy manufactured here in the United States. That’s how we’ll protect the climate and create jobs.’
Biden attended the meeting via remote video link as he recovers from COVID-19.