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recession ‘possible’ but unlikely, says Treasury secretary

A recession in the United States is unlikely but the risk exists, indicated the American Secretary of the Treasury, who also ventured into the field of pop culture thanks to a question about rapper Cardi B.

“There is a risk of recession,” acknowledged Thursday Janet Yellen, the US Treasury Secretary, at an event organized by the New York Timesas fears mount over the monetary policy measures needed to curb inflation.

To the question “is it likely?”, she replied “I don’t think so”.

Many observers are worried about a recession, as the US central bank (Fed) tightens its monetary conditions vigorously in order to slow demand and therefore lower the inflation rate.

Slowing inflation

However, “no element indicates that a recession is preparing”, estimated Janet Yellen, judging possible a “soft landing”, that is to say to slow inflation without plunging the economy into recession nor weigh too heavily on employment.

The Treasury Secretary was also asked about American rapper Cardi B, who wondered on Twitter on Sunday when the plunge of the economy into recession would be announced.

“I don’t have much time for her, but I know her,” replied the minister.

Inflation figures for May will be published on Friday and should still be very high, but could show that the slowdown started has continued.

In April, the rise in prices had indeed decelerated but, at +8.3% over one year, had remained very close to its highest in 40 years, observed in March, with +8.5%.

And it should proceed to a new turn of the screw, probably half a percentage point, Wednesday at the next meeting of its monetary committee.



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