(Bloomberg) U.S Treasury Secretary Janet Yellen expects a potential higher interest rate to be good for the economy. The calls back President Biden’s $4 trillion spending plan.
President Biden’s spending plans have raised eyebrows over a potential uptick in inflation and interest rates that could persist into next year.
Treasury’s Yellen believes the U.S has been fighting high inflation and interest for long and says possible surge would not be a bad thing.
Yellen has downplayed that Biden’s package, which is expected to add about $400 billion into the economy each year, will lead to inflation over-run.
The Treasury chief’s comments come when the consumer price index rose 4.2% in the year to April fueling concerns of further increases.
The Fed has announced plans to scale back its $120 billion asset purchases each month once substantial gains in inflation and employment are achieved.
Yellen has cooled the markets saying the monetary authorities have tools to handle inflation if it jumps.
DXY gains 0.08% on news. SPY is down 0.20% on premarket, QQQ is down 0.43% on premarket,
