Yellen Urges Congress to Raise Debt Ceiling & Highlights US Economic Strength Ahead of State of the Union
By Treasury Secretary Janet Yellen recently addressed growing concerns of a possible recession this year, despite the US having the lowest unemployment rate in over 50 years.[0] During an interview on ABC's “Good Morning America,” Yellen said, “You don’t have a recession when you have 500,000 jobs and the lowest unemployment rate in more than 50 years.”[1] Yellen also urged congress to increase the debt ceiling without delay, warning of the catastrophic effects if they fail to do so.[2]
Yellen highlighted the strength of the US economy, claiming it is “strong and resilient” and capable of sustaining a robust labor market even as inflation cools.[2] However, some economists are skeptical that a recession isn’t imminent and cite a leading indicator, which argues that financial conditions are about to tighten considerably for corporations.[3]
Yellen cautioned that the lag effects of tighter monetary policy are real and have yet to be fully felt, and therefore it is still important for Congress to raise the debt limit by summer.[3] The Treasury Secretary also hopes to visit China in the near future, but has no current plans or timing.
Finally, Yellen spoke on President Joe Biden's upcoming State of the Union Address, where the President will likely comment on the nation's economic outlook amid ongoing inflation.[4] Yellen praised the better-than-expected January job numbers and steadily decreasing inflation, both of which Biden will likely address in his speech.[4]
0. “Roundup: Federal debt limit / Energy project financing / Tax season” Greater Baton Rouge Business Report, 14 Feb. 2023, https://www.businessreport.com/newsletters/roundup-federal-debt-limit-energy-project-financing-tax-season
1. “Treasury Secretary Janet Yellen Says Likelihood of 2023 Recession Is Low” The Motley Fool, 13 Feb. 2023, https://www.fool.com/the-ascent/personal-finance/articles/treasury-secretary-janet-yellen-says-likelihood-of-2023-recession-is-low/
2. “Forget About That Recession? Yellen Says Economy Remains Strong” The Fiscal Times, 7 Feb. 2023, https://www.thefiscaltimes.com/2023/02/07/Forget-About-Recession-Yellen-Says-Economy-Remains-Strong
3. “Yellen Says No Recession On The Horizon – RIA” Real Investment Advice, 8 Feb. 2023, https://realinvestmentadvice.com/yellen-says-no-recession-on-the-horizon
4. “Failure to raise U.S. debt ceiling would lead to ‘economic and financial catastrophe,' Yellen says” CNBC, 6 Feb. 2023, https://www.cnbc.com/2023/02/06/failing-to-raise-us-debt-ceiling-would-lead-to-economic-and-financial-catastrophe-yellen-says.html
