Jonathan Ernst | Reuters The recession that many Americans fear is imminent is “not at all imminent,” Finance Minister Janet Yellen said Sunday. Discussions about a recession have accelerated this year as inflation remains high and the Federal Reserve is taking aggressive action to tackle it. On Wednesday, the Fed announced interest rate hikes of 75 basis points, the highest since 1994. Fed Chairman Jerome Powell also signaled the Federal Open Market Committee’s intention to continue its aggressive monetary policy tightening to curb inflation. . At the same time, many expect that the combination of resilience to consumer spending and job growth will keep the US out of recession. “I expect the economy to slow down,” Yellen told ABC News This Week. “It is growing very fast, as the economy, like the labor market, has recovered and we have reached full employment. It is natural now that we expect a transition to steady and stable growth, but I do not think a recession is inevitable.” . Although Yellen seemed optimistic about avoiding a recession, the global economy continues to face serious threats in the coming months with the ongoing war in Ukraine, skyrocketing inflation and the Covid-19 pandemic. “Clearly, inflation is unacceptably high,” Yellen said. However, he does not believe that the reduction in consumer spending would be the cause of a recession. Yellen told ABC News that the US labor market was the strongest since the post-war period and predicted that inflation would slow “in the coming months”.
