Yellen said recession risks are “not entirely off the table.” interview With Face the Nation airing on CBS on Sundays. Speaking from Beijing after meeting Chinese leaders, she said monthly job growth slowed as expected after remaining at a “high level”.
“We have a healthy economy, a great job market, and inflation [is] Very high and a concern for us and the American people, but it goes down over time.” And I hope, and I believe, that there is a path to lower inflation in the context of a healthy job market. And the data that I’ve seen suggests that we’re on that path.”
President Joe Biden said last month that he believes the United States will Avoid stagnation. “He’s been coming for 11 months, well guess what? I don’t think he’s coming,” he told Democratic donors on June 27.
Bloomberg Economics sees a base scenario of a US recession starting at the end of 2023, coinciding with a moderate slowdown in consumption, according to an analysis on June 30.
US inflation is likely to continue to ease in June, but a key measure of underlying price pressures is still running at an uncomfortable pace that has the Fed leaning towards a resumption of rate hikes. This month.
A government report on Wednesday is expected to show that the consumer price index rose 3.1% from a year ago, the lowest annual rate since March 2021. With volatile energy and food costs removed, core CPI is expected to rise 5% from a year ago. . While that would be the smallest annual increase since late 2021, it’s still more than double the Fed’s target, based on a different inflation measure.
Chicago Fed President Austan Goolsby said on Friday that policymakers are on “Golden roadTo moderate price growth without causing a recession in the world’s largest economy, as data that day showed a slowdown in what remains a robust labor market.
US nonfarm payrolls increased by 209,000 last month – less than economists expected – and job gains over the past two months have been revised downward. The unemployment rate fell to 3.6%, while average hourly earnings increased 4.4% from a year earlier.
The consensus of nearly all FOMC participants, Goolsby said, is one or two additional increases this year, which he said could come at any of the upcoming meetings in the second half of the year. The next policy decision will be July 26.
She was relenting in four days visiting to Beijing, where she described talks with her Chinese counterparts as helping bring bilateral relations closer to “more secure foundations”. Escalating tensions between the US and China have led to a tit-for-tat trade war and mounting restrictions on key technologies such as chips.
Yellen told CBS that while the Biden administration was considering additional controls on foreign investment, they would be “very narrowly targeted” and would not significantly affect bilateral investments with China.
She said she raised in Beijing the issue of China’s recent move to export restriction of two minerals important to the chip industry and reopened channels of communication that could be used to discuss concerns. DM