With the U.S. stock market slumping Friday, Treasury Secretary Janet Yellen went on television and said she didn’t expect a recession.
In back-to-back interviews on CNBC and Bloomberg, Yellen said the strong job market was a better indicator of the health of the economy.
“I don’t expect a recession,” she said. Yellen said the stock market is not “a reflection of the underlying strength of the economy.”
Yellen said that inflation may have peaked, but quickly added that high inflation won’t disappear.
“We will have to put up with high inflation a little longer,” Yellen said.
The Treasury Secretary, who ran the Federal Reserve from 2014 to 2018, said the Fed Chairman Jerome Powell and his colleagues plan to raise interest rates to get inflation under control but in a way that won’t cause the economy to crash.
Reaching such a “soft landing” will take some skill and luck, Yellen said, but it is important to get inflation under control.
The decline in stocks
gathered steam over much of morning trading.
The yield on the 10-year Treasury note
remained close to the highest levels of the year on expectations of Fed rate hikes.