US Treasury Secretary Janet Yellen on Inflation Battle

On 20 November 2023, U.S. Treasury Secretary Janet Yellen appeared on CNBC’s “Squawk Box” to discuss various economic issues with co-anchor Andrew Ross Sorkin. The conversation covered the economic implications of the recent meeting between President Biden and Chinese President Xi Jinping, the state of the U.S. economy, the ongoing battle against inflation, and geopolitical concerns.

Janet Yellen is a distinguished American economist and the first woman to serve as the U.S. Secretary of the Treasury, a role she assumed in January 2021 under President Joe Biden. Her responsibilities include overseeing the Treasury Department, which is crucial in shaping financial, economic, and tax policies.

Previously, Yellen made history as the first female Chair of the Federal Reserve from 2014 to 2018, where she played a pivotal role in U.S. monetary policy. Her career also includes serving as the Vice Chair of the Federal Reserve, President of the Federal Reserve Bank of San Francisco, and Chair of the Council of Economic Advisers under President Bill Clinton.

An accomplished academic, Yellen is a Professor Emerita at the University of California, Berkeley. Her extensive experience and expertise in economics have established her as a key figure in shaping U.S. economic policy.

Progress in Inflation Battle

Yellen acknowledged that there has been considerable progress in bringing down inflation. She cited recent statistics showing a decrease in the 12-month headline inflation rate to 3.2%, a significant drop from its peak. However, she noted that despite the general slowdown in price increases, Americans are still experiencing higher prices in some essential areas, such as food and rent, compared to pre-pandemic levels.

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Economic Perception vs. Reality

Addressing the disconnect between economic improvements and public perception, Yellen emphasized the need to communicate effectively about the Biden administration’s efforts to improve the economy. She observed that while the administration is making progress, particularly in reducing inflation and maintaining a strong labor market, this progress is not necessarily reflected in public opinion polls. Yellen mentioned a recent poll indicating that a significant portion of young voters rates the economy poorly.

Investments and Economic Prospects

Yellen highlighted the administration’s investments in various sectors, including over $500 billion in manufacturing investments announced as a result of legislation such as the Infrastructure Bill, the CHIPS and Science Act, and the Inflation Reduction Act. She expressed optimism that these investments would lead to the creation of good jobs, especially in regions that have been economically left behind, thereby improving America’s economic prospects in the medium term.

Geopolitical Concerns and Aid Packages

Turning to geopolitical issues, Yellen discussed the critical importance of aid packages for Ukraine and Israel. She stressed that it is essential for the U.S. to support Ukraine in its battle, both on the battlefield and on the home front, to prevent a collapse due to financial constraints. Yellen also underscored the importance of aid to Israel, linking these aid packages directly to the national security of the United States.

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• Source: https://www.cryptoglobe.com/latest/2023/11/u-s-treasury-secretary-warns-of-persistent-inflation-despite-progress-a-challenging-economic-outlook/