US Shows Progress in Inflation Battle
In an interview with Bloomberg TV, US Treasury Secretary Janet Yellen conveyed her optimistic outlook on the country's economic health, stating that the United States is succeeding in controlling inflation. Speaking from India during a Group of 20 finance officials' meeting, Yellen dismissed the possibility of a US recession, citing the robustness of the labor market and a trend of decreasing inflation.
Impact of Slower Growth in China
While acknowledging the potential for slower economic growth in China to affect other economies, Yellen affirmed the resilience of the US. The Treasury Secretary emphasized, "For the United States, growth has slowed, but our labor market continues to be quite strong. I don't expect a recession." She pointed to recent inflation data as particularly encouraging, indicating that the US is on a good path to economic stability.
Unresolved Trade Issues with China
During her recent visit to China, Yellen faced serious concerns raised by Chinese officials, primarily revolving around US-imposed tariffs. However, she noted that the original reasons for these tariffs – specifically, unfair trade practices – remained unaddressed. "We have to see what comes out of the four-year review of tariffs," Yellen said, underscoring the need for further efforts to address these underlying concerns.
US Plans New Regulations on Investment in China
Yellen disclosed potential plans for a new executive order that would restrict outbound US investment in China. However, she emphasized that such regulations would be limited to three key sectors: semiconductors, quantum computing, and artificial intelligence. "These would contain a combination of notification requirements and in a very narrowly scoped portion of these sectors, prohibitions, but these would not be broad controls that would affect U.S. investment broadly in China," Yellen clarified.