With 500,000 jobs, lowest 50-year unemployment you don't have recession, says Yellen
Business
Biden's concern to reduce inflation, economy shows strength and resilience, US Treasury Secretary
WASHINGTON (Reuters) - Given the strength of the American job market US Treasury Secretary Janet Yellen stated on Monday that she saw a route for avoiding a US recession with inflation declining considerably and the economy continuing robust.
When there are 500,000 jobs and the lowest unemployment rate in more than 50 years you don't have a recession, Yellen said on ABC's Good Morning America. "What I see is a path where the economy is still robust and inflation is dropping dramatically," she added.
Yellen said that inflation was still too high but it has been declining for the past six months and may continue to do so given the Biden administration's policies which include initiatives to lower the price of prescription medications and fuel.
Nonfarm payrolls increased by 517,000 jobs in January and the unemployment rate fell to a 53-1/2-year low of 3.4 percent, according to figures from the US Labor Department issued on Friday.
The hopes of the market that the US Federal Reserve was about to pause its cycle of tightening monetary policy were lessened by the strength in hiring which took place in spite of layoffs in the technology industry.
Biden's primary concern was still bringing down inflation but the American economy was showing itself to be strong and resilient, Yellen told.
Yellen urged Congress to increase the debt ceiling for the United States saying that doing otherwise would result in an economic and financial disaster. Even though it has occasionally come down to the wire Congress has always acknowledged this as their role and has to act again.
The Treasury Department issued a warning when the US government reached its $31.4 trillion debt ceiling last month saying that it might not be able to avoid default into early June.
Speaker of the Republican-controlled U.S. House of Representatives Kevin McCarthy and President Joe Biden spoke last week about extending the debt ceiling and vowed to meet again, but the impasse has roiled the financial markets.
