Treasury Chief Yellen Tells CNN No ‘Signs of a Recession’ After Strong GDP Report

Secretary of the Treasury Janet Yellen told CNN that she sees no “signs of a recession” after a GDP report that was better than expected, and amid months of critics saying the U.S. is already in a recession or headed for one.

On Thursday morning, brand-new economic numbers showed a better-than-expected increase in Gross Domestic Product and a significant slowing in a key inflation indicator, the PCE price index:

• “Real gross domestic product (GDP) increased at an annual rate of 2.6 percent in the third quarter of 2022 (table 1), according to the “advance” estimate released by the Bureau of Economic Analysis. In the second quarter, real GDP decreased 0.6 percent.”
• “The price index for gross domestic purchases increased 4.6 percent in the third quarter, compared with an increase of 8.5 percent in the second quarter (table 4). The PCE price index increased 4.2 percent, compared with an increase of 7.3 percent. Excluding food and energy prices, the PCE price index increased 4.5 percent, compared with an increase of 4.7 percent.”

On Thursday night’s edition of CNN’s OutFront, Secretary Yellen echoed President Joe Biden‘s sentiment, telling White House correspondent Phil Mattingly that she doesn’t see signs of a recession in a raft of positive economic indicators, but acknowledging Inflation is “unacceptably high”:

PHIL MATTINGLY, CNN SENIOR WHITE HOUSE CORRESPONDENT (voice-over): As Democrats scramble to coalesce around an economic message to hang on to their congressional majorities —

JANET YELLEN, SECRETARY OF TREASURY: I don’t see signs of a recession in this economy at this point.

MATTINGLY: — Treasury Secretary Janet Yellen sitting down with CNN to deliver her own.

YELLEN: We have unemployment at a 50-year low. There are two job vacancies for every American who is looking for work.

We have solid household finances, business finances, banks that are well capitalized. And we’ve been creating average 300,000 jobs a month.

MATTINGLY: It’s an economic scorecard the hardly tracks with an exceedingly unsettled electorate.

The discontent seems to be real. The feelings about the direction of the economy seem to be largely negative. Why?

YELLEN: Inflation is very high. It’s unacceptably high. And Americans feel that every day.

…MATTINGLY: I understand what you’re saying in terms of the time horizon. Yours is not very helpful when there’s midterm elections in 12 days. I know you don’t come from a political background here, but how much does that weigh into the policy process that you guys pursue?

YELLEN: Well, as I said, we’re doing everything that we can to supplement what the Fed is doing to bring inflation down. And medium term, we have an historic investment in the strength of our economy, the passage of three very important bills.

MATTINGLY: But also what officials view as a historically rapid recovery.

YELLEN: These are problems we don’t have because of what the Biden administration has done. So, often one doesn’t get credit for problems that don’t exist.

MATTINGLY: All as Biden’s legislative wins have driven tens of billions of dollars in private sector investment to manufacturing across the country.

Is the kind of message at this point, to some degree, we’ve done the work, be patient, it’s coming?

YELLEN: Yes, but we’re beginning to see repaired bridges come on line, not in every community. Pretty soon, many communities are going to see roads improved, bridges repaired that have been falling apart. We’re seeing money flow into research and development, which is really an important source of long-term strength to the American economy.

And America’s strength is going to increase, and we’re going to become a more competitive economy.

Watch above via CNN’s OutFront.

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