U.S. Treasury Secretary Janet Yellen says inflation levels are still unacceptably high.
A recession is still “not completely off the table,” but the country appears to be on the right path to bring down inflation, Yellen told CBS News.
“We have a healthy economy, a great labor market,” Yellen said. “And it’s my hope that, and belief, that there is a path to bring inflation down in the context of a healthy labor market. And the data that I’ve seen suggests we’re on that path.”
According to the jobs report, U.S. employers added 209,000 jobs in June compared to May, which added 306,000 jobs. Regarding the jobs report, Yellen said the jobs report was to be expected given the labor market’s expansion in recent months.
“But we would expect, with the job market as strong as it is now, to see a slower pace of ongoing job gains,” Yellen said. “Prime age labor force participation is at the highest level in several decades, so we’ve seen this strong job market attract workers back to it.”
President Joe Biden recently said that he thinks the U.S. will avoid a recession. “It’s been coming for 11 months, well guess what? I don’t think it will come,” he told Democratic Party donors on June 27.
According to an analysis by Bloomberg Economics, a baseline scenario suggests that a U.S. recession could commence towards the end of 2023, aligning with a gradual decline in consumption.
A government report scheduled for Wednesday is expected to reveal that the consumer price index (CPI) increased by 3.1% compared to the previous year, Bloomberg reported.
This marks the slowest annual growth rate since March 2021. However, when excluding the volatile energy and food costs, the core CPI is anticipated to rise by 5% compared to the previous year.
With an upcoming election year, Biden’s approval rating is still standing in the 40% range despite a high inflation rate, but a current unemployment percentage at 3.6%.
A jobs report revealed on Friday that the labor market was starting to see signs of the job growth slowing.
Others in Wall Street are prepared for the possibility of interest rates increasing as the Federal Reserve prepares to make a decision on the interest rate hikes.
The current inflation rate stands at 4% which Federal Reserve Chair Jerome Powell is keeping his goal at 2%.
The economy is expected to be the topic in the 2024 presidential election.l
Produced in association with Benzinga
Edited by Alberto Arellano and Joseph Hammond
