In an exclusive interview with Reuters, Janet Yellen, the US Treasury Secretary, discussed the latest economic developments in the country. Despite a weaker-than-expected first-quarter GDP reading of 1.6%, Yellen expressed optimism about the overall health of the US economy and inflation moving toward a more normal level.
The Commerce Department reported that the US economy grew at an annualized rate of 1.6% in the first quarter, marking the slowest pace of growth since the second quarter of 2022. Nonetheless, economic growth continues to be strong, with a robust job market and consumer spending.
Yellen also addressed inflation concerns, stating that while progress has been made in reducing it, rising gas prices and high services and shelter costs have halted its progress this year. Federal Reserve officials have warned that bringing down inflation will be a challenging process, and they are expected to hold interest rates steady in their upcoming meeting.
Internationally, geopolitical tensions continue to rise with conflicts in Ukraine and the Middle East. Additionally, tensions between China and the United States have become increasingly strained due to trade disputes and calls for a review of tariffs on Chinese steel and aluminum by President Biden. The ongoing review is expected to be completed soon, with actions potentially taken to enhance tariff effectiveness based on findings.
Overall, Yellen expressed optimism about the future of the US economy while acknowledging challenges such as inflationary pressures and international tensions.