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Yellen confident Congress will follow through on global tax deal

elean
2 minutes

WASHINGTON (BLOOMBERG) - Treasury Secretary Janet Yellen said she expects Congress to take action soon to bring the United States into line with a global minimum tax agreed on last week by 136 countries. "I am confident that what we need to do to come into compliance with the minimum tax will be included in a reconciliation package," Dr Yellen said Sunday (Oct 10) on ABC's This Week, referring to a spending Bill Democrats are preparing. An overhaul of how to tax multinational companies took a big step forward Friday in talks hosted by the Organisation for Economic Cooperation and Development. Countries agreed to enforce a minimum corporate tax rate of 15 per cent. Dr Yellen also expressed confidence that Democrats would come to an agreement over the content and size of a long-term spending package. Party moderates have rejected the US$3.5 trillion (S$4.7 trillion) headline number US President Joe Biden had proposed. Senator Chris Coons, a Delaware Democrat, said on Fox News Sunday he expects the number to be whittled down to about US$2 trillion. "This is a healthy give-and-take going on right now among Democrats with different points of view," Dr Yellen said. "We do have a limit on...

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As US debt default looms, Yellen faces her biggest test yet

elean
7 minutes

WASHINGTON (NYTIMES) - When Janet Yellen was Federal Reserve chair in 2014, she faced a grilling from Republicans about whether the federal government had a plan if the nation's borrowing limit was breached and measures to keep paying the country's bills were exhausted. Ms Yellen, appearing at a congressional hearing, outlined a dire scenario in which financial institutions might try to make payments that they could not cover, because the Treasury Department was out of money, leading to a cascade of bounced checks. She pushed back against the notion held by some Republicans that an economic meltdown could be averted, warning that there was no secret contingency plan. "To the best of my knowledge, there is no written-down plan," Ms Yellen said at the time, adding that it was beyond her remit at the Fed. "That's a matter that is entirely up to the Treasury." Fending off such a calamity is now squarely the responsibility of Ms Yellen, who is confronting the biggest test she has faced in her eight months as US President Joe Biden's treasury secretary. Mr Biden chose Ms Yellen to help steer the economy out of the pandemic downturn. But in the face of congressional dysfunction, she has b...

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US to see ‘several more months’ of high inflation, Yellen says

elean
2 minutes

WASHINGTON (AFP) - Inflation will remain high in the United States for months to come but eventually retreat, Treasury Secretary Janet Yellen said on Thursday (July 15). The comments come after Labour Department data earlier this week showed record-setting increases in the consumer and wholesale prices, again fanning the debate over whether government stimulus and the Federal Reserve's easy money policies are allowing the US economy to run too hot as it bounces back from the Covid-19 pandemic. "I think we will have several more months of rapid inflation, so I'm not saying that this is a one month phenomenon," Dr Yellen said during an interview on CNBC. However, she predicted price increases will reach "normal levels" over the medium term. "It is important that we monitor it carefully, but I believe fundamentally, that this is something that will settle down," she said. The producer price index increased 7.3 per cent, not seasonally adjusted, for the 12 months ended in June, its largest-ever yearly increase since the Labour Department began tracking it more than a decade ago, it announced on Wednesday. The day before, the department reported the consumer price index climbed by an un...

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Yellen says US interest rates may have to rise if economy heats up; comments roil markets

elean
3 minutes

WASHINGTON (AFP) - US interest rates may have to increase "somewhat" to keep a lid on inflation if President Joe Biden's latest spending proposals are enacted and the economy heats up, Treasury Secretary Janet Yellen said on Tuesday (May 4). But after her comments set off a mini-firestorm and sent stock prices tumbling, Ms Yellen later clarified that she was not predicting nor suggesting the Federal Reserve should raise rates. After winning approval for a US$1.9 trillion (S$2.5 trillion) pandemic rescue plan in March, Mr Biden has made two more proposals totaling nearly US$4 trillion over a decade and partially paid for with tax increases on corporations and the wealthy. The goal is to revamp the US economy after the Covid-19 pandemic caused a severe downturn in 2020. "It may be that interest rates will have to rise somewhat to make sure that our economy doesn't overheat," Ms Yellen said in a pre-recorded conversation with The Atlantic. However, she said "the additional spending is relatively small relative to the size of the economy" and is over a larger time frame than the pandemic rescue spending, which focused on immediate needs of workers and families. Though Ms Yellen acknowl...

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Markets upbeat on Yellen’s push for large fiscal stimulus

elean
2 minutes

Regional investors were generally won over yesterday when United States Treasury Secretary nominee Janet Yellen made the case for President Joe Biden's US$1.9 trillion (S$ 2.5 trillion) relief package. Dr Yellen urged lawmakers to "act big", adding that help for the unemployed and small businesses would provide the "biggest bang for the buck". The promise of greater stimulus fuelled Wall Street's overnight rally and lifted optimism in Asia. Despite beginning the day on a softer note, the Straits Times Index (STI) picked up over the course of the session to inch up 0.1 per cent, or 2.85 points, to 2,998.77. Gainers outnumbered losers 302 to 205, with 3.48 billion shares worth $1.52 billion changing hands. Similarly, the benchmark Kospi in Seoul ended up 0.71 per cent and Chinese markets also rose - the Hang Seng Index gained 1.08 per cent, while the Shanghai Composite added 0.47 per cent. Oanda senior market analyst Jeffrey Halley said: "Janet Yellen made all the right noises as far as Wall Street was concerned. After a rocky start, Asian equities are staying on message and following Wall Street higher. Until the US Senate Republicans reveal their hand, US stimulus talk and dovishly...

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US stocks gain on inauguration eve, Yellen call for stimulus

elean
2 minutes

NEW YORK (AFP) - Wall Street stocks won solid gains on Tuesday ((Jan 19) as markets anticipated the presidential inauguration of Joe Biden while Biden's Treasury secretary nominee reiterated a call for aggressive stimulus spending. Janet Yellen, the former Federal Reserve chairman nominated to lead economic policy, during her Senate confirmation hearing called for Washington to "act big" to support the coronavirus-ravaged US economy. The Dow Jones Industrial Average gained 0.4 per cent to finish at 30,930.52. The broad-based S&P 500 rose 0.8 per cent to end at 3,798.91, while the tech-rich Nasdaq Composite Index jumped 1.5 per cent to 13,197.18. Stephen Innes, chief global market strategist at Axi, said the uptick reflects "the market giving the Biden policy agenda an early stamp of approval" a day before his administration takes office. Among individual companies, General Motors shot up 9.8 percent after announcing an alliance with Microsoft on its Cruise autonomous driving venture. Microsoft gained 1.8 per cent. Boeing won 3.1 per cent as the European Union Aviation Safety Agency said it would clear the company's 737 Max plane to resume flights next week, 22 months after the jet ...

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Biden Treasury nominee Janet Yellen to say US does not seek weaker dollar: WSJ

elean
2 minutes

BENGALURU (REUTERS) - Janet Yellen, President-elect Joe Biden's pick to take over the US Treasury, is expected to affirm the United States' commitment to market-determined foreign exchange rates when she testifies on Capitol Hill on Tuesday, the Wall Street Journal reported on Sunday (Jan 17). The Treasury secretary nominee will make clear at a Senate confirmation hearing that the United States does not seek a weaker dollar, the newspaper reported, citing Biden transition officials familiar with her preparation for the session. "The value of the US dollar and other currencies should be determined by markets. Markets adjust to reflect variations in economic performance and generally facilitate adjustments in the global economy," Ms Yellen will say, if asked about the incoming administration's dollar policy, according to the report. "The United States doesn't seek a weaker currency to gain competitive advantage," she is prepared to say, according to the WSJ. "We should oppose attempts by other countries to do so." A Biden transition team official did not respond to a request for comment about Ms Yellen's testimony. Mr Biden, a Democrat, takes office on Wednesday. The policy outlined ...