Trade did not contribute to the economy’s annualized growth rate of 1.3% in the first quarter, after having contributed to the Gross Domestic Product (GDP) for three consecutive quarters.
Yellen asserts that the economy is strong
Against this backdrop, Treasury Secretary Janet Yellen said the US economy is strong thanks to strong consumer spending, and continued progress in reducing inflation is expected over the next two years.
In an interview with CNBC, Yellen said that while banks may struggle with commercial real estate and face some consolidation, there is plenty of liquidity in the system and they should generally be able to withstand any stress.
Yellen said legislation to raise the debt ceiling and reduce the deficit by more than $1 trillion in a decade will support the Federal Reserve’s efforts to reduce inflation.
“Consumer spending has continued to grow quite robustly, but you also see areas of the economy that are slowing down,” Yellen said.
He said banks will face some difficulties related to commercial real estate due to rising rates and remote working, which has reduced demand for office space, but stress tests have shown they have adequate capital. , and banking supervisors are closely studying the situation.
“My general opinion is that the level of capital and liquidity in the banking system is solid and that, even if there are some problems, the banks should be able to withstand the stress,” he said.
