Indicates Willingness to Raise Interest Rates Again
Emphasizes Inflation as a Temporary Phenomenon
[Asia Economy New York=Correspondent Baek Jong-min] Janet Yellen, U.S. Treasury Secretary, once again made remarks endorsing interest rate hikes.
On the 6th (local time), in an interview with Bloomberg, Secretary Yellen said, "Even if we have a somewhat higher interest rate environment, it is positive from the perspective of society and the Federal Reserve (Fed)."
She also stated, "We have been fighting too low inflation and interest rates for the past decade," adding, "We want to return to a normal interest rate environment. If this helps ease the situation, it is not a bad thing."
Yellen, who previously served as Fed Chair, had earlier sparked controversy by saying, "We may need to raise interest rates somewhat to prevent the economy from overheating."
Secretary Yellen predicted that the Biden administration's infrastructure investment spending would be limited to $400 billion annually, so it would not cause a surge in inflation, and reiterated, "Inflation will disappear next year."
She foresaw that even if inflation rises, central banks around the world can handle it. She mentioned, "I know that world. They are very capable. I do not believe they will mess it up."
Bloomberg cited an anonymous official saying that G7 finance ministers fully agreed with Secretary Yellen's view that the recent inflation is temporary.
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
