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Biden Administration Downplays Recession Risks as Economic Outlook Deadline Looms

Brian Gornick - Staff Writer - News

Treasury Secretary Janet Yellen.

Photo: foxbusiness.com


United States Treasury Secretary Janet Yellen stated Sunday that although the U.S. economy is slowing down, it does not mean that the United States is on an inevitable path towards recession.


In an interview on NBC’s “Meet The Press,” Yellen argued that consumer spending growing, a national unemployment rate of 3.6%, and over 400,000 jobs being added per month this year are all signs that parts of the economy remain healthy.


“This is not an economy that’s in recession.” Yellen told NBC News.

As Yellen and other members of the Biden administration point to signs the economy is healthy and on the come-up, others have a much bleaker view on the economy. Americans are spending less than ever as inflation is at 9.1%, the highest in two generations, and the Federal Reserve has hiked up borrowing costs in response.


These two aspects of the economy have raised fear among economists that the U.S. economy is headed towards a recession, as this Thursday the Commerce Department will release its first estimate of the economy’s output in the April-June quarter.


The U.S. economy shrank by 1.6% in the January-March quarter to start the year, and if Thursday’s estimate shows that the economy shrank once again, by definition the economy would be in a recession.


Other economists recently have been raising the alarm about a recession on the horizon. Bank of America’s economists have been the latest to forecast a recession, stating last week that the economy was headed towards a “mild recession.” Larry Summers, the treasury secretary under former President Bill Clinton, stated in an interview with CNN that there is a “very high likelihood of a recession.”


While the rest of the world is grappling with rising inflation and the threat of recession, the United States has an increasingly pessimistic view on the economy. In a national June poll by the New York Times, more than half of the respondents stated that they believe the U.S. economy is already in a recession or a depression.

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