Finance Minister Janet Yellen says a recession is not “inevitable”.

U.S. Treasury Secretary Janet Yellen testified before a House of Representatives committee hearing on the 2023 budget proposed by President Biden on Capitol Hill, Washington, June 8, 2022.

Jonathan Ernst Reuters

The recession, which many Americans fear is coming, is not “inevitable at all,” Finance Minister Janet Yellen said Sunday.

Talk of a recession has accelerated this year as inflation remains high and the Federal Reserve takes aggressive steps to counter it. On Wednesday, the Fed announced an increase in interest rates by 75 basis points, the highest since 1994. Fed Chairman Jerome Powell also noted the intention of the Federal Open Market Committee to continue its aggressive path of tightening monetary policy to curb inflation .

At the same time, many expect the combination of sustainability of consumer spending and job growth to protect the United States from recession.

“I expect the economy to slow down,” Yellen told ABC.This week“” It is growing at a very fast pace as the economy, as well as the labor market, has recovered and we have reached full employment. It is now natural to expect a transition to stable and stable growth, but I do not think that a recession is inevitable at all. “

Although Yellen seemed optimistic about avoiding a recession, the global economy still faces serious threats in the coming months with the ongoing war in Ukraine, rising inflation and the Covid-19 pandemic. “It’s clear that inflation is unacceptably high,” Yellen said.

However, she does not believe that the drop in consumer spending would be the cause of a recession. Yellen told ABC News that the US labor market was the strongest since the war and predicted that inflation would slow “in the coming months.”

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