U.S. Treasury Secretary Janet Yellen expressed her belief that the U.S. economy is not heading towards a downturn. However, she cautioned that if Congress fails to pass legislation to keep the government running, it could potentially slow down the momentum of the economy. Yellen made these remarks during an interview with CNBC, where she also highlighted the strength of the U.S. labor market and the decreasing inflation rate. She emphasized the importance of avoiding a government shutdown, stating that there is no reason for it and that it could pose a risk to the economy. Yellen also commented on the ongoing strike by the United Auto Workers against the Detroit Three U.S. automakers, stating that it is too early to determine its impact and that it will depend on its duration and who is affected. She reiterated President Joe Biden’s commitment to collective bargaining and ensuring that workers benefit from the industry’s success. Yellen acknowledged that while the labor market remains strong, it is cooling down compared to previous levels, which is crucial for achieving the objective of lowering inflation to 2%. As the former chair of the Federal Reserve, Yellen noted that the central bank’s decision to raise interest rates has started to affect the housing market, but consumer spending remains robust. She also mentioned that the Biden administration is closely monitoring gasoline prices to ensure they remain affordable for Americans.
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