There is no guarantee that the unemployment rate will rise
Inflation and employment ‘two rabbits’ possible
US Treasury Secretary Janet Yellen (pictured) said on the 22nd (local time) that the US will not reach its inflation target of 2% next year.
Market Watch reported that Yellen made this statement at a conference hosted by Atlantic Magazine on the same day, saying, “Inflation will definitely drop next year, but there is a risk.”
“The Russian invasion of Ukraine is not over yet, and Russia is weaponizing oil and gas,” Yellen said. “Nevertheless, I think the Fed will definitely bring inflation down and it will be a success,” he added.
“There are currently two jobs for every unemployed person in the United States,” he said. “The situation is putting pressure on inflation,” he said. “I don’t want to say that the Fed needs to ease labor market pressures, but that doesn’t mean the unemployment rate has to skyrocket in the process,” he said. He thinks there is a way to lower inflation while maintaining a strong labor market.
However, Yellen said it would be difficult to achieve the inflation target of 2% within the next year. Fed Chairman Jerome Powell said the day before that the Fed will continue to raise rates until it sees solid evidence that inflation is nearing its 2% target. In the economic outlook released after the Federal Open Market Committee (FOMC) held on the same day in September, the Fed set its personal consumer spending (PCE) growth target for next year at 2.8% compared to the previous year. This is half of the 5.4% forecast for PCE growth this year.
If the US inflation rate does not drop to 2% next year, as Yellen predicted, the Fed is likely to raise the key interest rate further. If inflation does not fall below 2%, the Fed may revise its inflation target.
On the same day, Minister Yellen said that the introduction of the G7 cap on the price of Russian crude oil is “already having an effect.” criticized Regarding Europe’s winter energy supply and demand problem, he said, “I don’t want to exaggerate the impact it will have on the US economic growth, although it will have repercussions in the US.”
Washington = Correspondent Jeong In-seol [email protected]