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Yellen says signs of U.S. recession aren’t in sight ‘when you’re creating almost 400,000 jobs a month’

July 24, 2022, 7:08 PM UTC
U.S. Treasury Secretary Janet Yellen
U.S. Treasury Secretary Janet Yellen speaks during a lunch meeting with women entrepreneurs on July 19, 2022 in Seoul, South Korea. Yellen visit to South Korea for two days trip to discuss economic and financial cooperation and the strengthening of multilateral arrangements.
Lee Jin-Man—Pool/Getty Images

Treasury Secretary Janet Yellen expressed confidence in the Federal Reserve’s fight against inflation and said she doesn’t see any sign that the U.S. economy is in a broad recession.

“We’re likely to see some slowing of job creation,” Yellen said on NBC’s “Meet the Press” on Sunday. “I don’t think that that’s a recession. A recession is broad-based weakness in the economy. We’re not seeing that now.”

With U.S. consumer prices rising at the fastest rate in four decades, a growing number of analysts say it will take a recession and higher joblessness to ease price pressures significantly. The Federal Reserve raised rates in June by the most since 1994 and is expected to approve another 75 basis-point hike this week.

Inflation is “way too high,” Yellen said, while renewing the Biden administration’s argument that it’s also high in many other advanced economies.

“The Fed is charged with putting in place policies that will bring inflation down,” said Yellen, a former Fed chair. “And I expect them to be successful.” 

Even if the US posts two consecutive quarters of economic contraction, Yellen—citing the U.S. job market—said she doesn’t expect that the academics at the National Bureau of Economic Research who rule on recessions would call one.

“I would be amazed if the NBER would declare this period to be a recession, even if it happens to have two quarters of negative growth,” she said. “We’ve got a very strong labor market. When you’re creating almost 400,000 jobs a month, that is not a recession.” 

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