The United States is unlikely to suffer an economic downturn, despite sky-high inflation, US Treasury Secretary Janet Yellen said Thursday.
“There’s nothing to suggest that there’s a recession in the works,” she said during an interview at The New York Times’ economic forum.
The US economy has recovered strongly from the Covid-19 damage, but the highest inflation in four decades and supply chain snarls exacerbated by Russia’s invasion of Ukraine are increasing pessimism.
The US Labor Department is set to release the May consumer price index (CPI) report on Friday, and analysts expect the data could potentially show a modest slowdown in the torrid 8.3 percent annual pace.
The Federal Reserve has begun raising interest rates aggressively, with another big hike expected next week, as policymakers attempt to combat inflationary pressures without triggering a recession.
Yellen expressed confidence they will be successful.