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White House recognizes ‘risk’ of recession as US experiences high inflation

The United States Government recognized that there is a “risk” of recession, at the same time that the country is experiencing high inflation, and underlined that the economy is in a period of “transition” after the impact of the pandemic.

In an interview on CNN television, the director of the National Economic Council at the White House, Brian Deese, acknowledged, the possibility of a recession, that “there are always risks” given the global challenges and the monetary measures taken to face the high inflation rate in the United States, the highest since the early 1980s.

“Our economy is transitioning from what has been the strongest recovery in modern US history to what could be a period of more stable and resilient growth that works better for families,” he said.

The Federal Reserve, the central bank of the United States, kept key interest rates between 0% and 0.25% for two years to stimulate the economy.

This year it reversed this policy and has already approved two consecutive increases to contain the rise in prices.

Thus, the official interest rate of the world’s largest economy is between 0.75% and 1%, and further increases in the price of money in the US are expected.

Deese stressed that it is necessary to give the Federal Reserve “independence” to do its job, noting that it “has the instruments to fight inflation.”

According to data from the Department of Commerce, inflation in the United States remains at levels not seen for forty years, although it moderated slightly in April to 8.3%, two tenths less than in March.

However, April unemployment in the United States stood at 3.6% of the workforce, the lowest in two years.

Source: With Agencies

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