Yellen offered a dose of optimism even as economists grow increasingly worried about a recession fueled by skyrocketing inflation and the Russian invasion of Ukraine.
Department of the Treasury Secretary Janet Yellen listens to lawmakers as she testifies during a Senate Finance Committee hearing to examine President Joe Biden's proposed budget request for fiscal year 2023, on Capitol Hill, Tuesday, June 7, 2022, in Washington. – Treasury Secretary Janet Yellen said Sunday that she expects the U.S. economy to slow in the months ahead, but that a recession is not inevitable.
Yellen offered a dose of optimism even as economists grow increasingly worried about a recession fueled byShe also expressed an openness, during an interview on ABC's “This Week,” to a federal gas tax holiday to help give motorists some relief at the pump. Several lawmakers have floated the idea as the average price of gasoline hovers around $5 per gallon; the tax is 18.4 cents per gallon.
“That’s an idea that’s certainly worth considering,” Yellen said when asked if the administration is weighing it. She added that President Joe Biden wants “to do anything he possibly can to help consumers.” And Energy Secretary Jennifer Granholm said “it's one of the tools,” but told CNN's “State of the Union” that “part of the challenge with the gas tax, of course, is that it funds the roads.
“I expect the economy to slow,” Yellen said. “It’s been growing at a very rapid rate and the economy has recovered and we have achieved full employment. We expect a transition to steady and stable growth, but I don’t think a recession is at all inevitable.”with The Associated Press last week insisted that a recession is “not inevitable” and made the case that U.S. is"in a stronger position than any nation in the world to overcome this inflation.
The tightening of monetary policy was accompanied by a downgrade to the Fed’s economic outlook, with the economy now seen slowing to a below-trend 1.7% rate of growth this year, unemployment rising to 3.7% by the end of this year and continuing to rise to 4.1% through 2024.Yellen said it will take “skill and luck” to bring down inflation while maintaining low unemployment.Copyright 2022 The Associated Press. All rights reserved.
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