Janet Yellen | Photo credit: ANI
The global economy is doing better today than many predicted just months ago, although there are still significant headwinds, U.S. Treasury Secretary Janet Yellen said Thursday during a briefing. a press conference in Bangalore.
“It’s fair to say that the global economy is doing better today,” she said, adding that in the fall many had worried about a sharp economic downturn across the world.
“The challenges we face are real and the future is still uncertain. But the outlook has improved since we got together in the fall,” she explained. In its most recent estimates, the IMF raised its forecast for global growth in 2023 to 3.2%, a notable improvement from October, she said.
Ms Yellen said the US economy remained resilient as headline year-on-year inflation moderated in recent months, supply chain pressures eased and global imbalances eased. “At the same time, our labor market remains strong. In January, unemployment in the United States hit a low not seen in more than half a century,” she added.
Ms. Yellen said forums like the G20 were important venues for macro-economic cooperation.
“At our meetings last fall, there was a shared view…that we must take decisive action on the challenges we face in our own countries, including the fight against high inflation” , she said.
It was also important to be mindful of the spillover effects of monetary tightening in major economies on the rest of the world, she noted. “While there is still a lot of work to be done, we are starting to see a decline in headline inflation around the world. In emerging markets, financial conditions remain relatively tight, but have started to show signs of easing.
However, Ms Yellen acknowledged that a number of vulnerable countries continued to face acute distress. “We are not out of the woods yet,” she added.