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Treasury Secretary Janet Yellen says “our economy remains resilient” despite rising inflation and the worry about a recession.
Watch Yellen’s remarks in the player above.
“Most economists and most Americans have a similar definition of recession – substantial job losses and mass layoffs. Businesses shutting down, private sector activity slowing considerably, family budgets under immense strain,” said Yellen Thursday. “In sum, a broad based weakening of our economy. That is not what we’re seeing right now. When you look at the economy, job creation is continuing. Household finances remain strong. Consumers are spending and businesses are growing.”
READ MORE: Your guide to Congress’s new inflation-fighting package
This comes as the U.S. economy shrank from April through June for a second straight quarter, contracting at a 0.9 percent annual pace and raising fears that the nation may be approaching a recession.
The decline in the gross domestic product, the broadest gauge of the economy, followed a 1.6 percent annual drop from January through March.
Consecutive quarters of falling GDP constitute one informal, though not definitive, indicator of a recession. The report comes at a critical time.
Consumers and businesses have been struggling under the weight of punishing inflation and higher borrowing costs.
On Wednesday, the Federal Reserve raised its benchmark interest rate by a sizable three-quarters of a point for a second straight time.
WATCH: Federal Reserve raises interest rates amid stubbornly high prices and recession concerns
“I think that the discomfort that households feel, it’s not because of the job market. Jobs are readily available, and most Americans feel good about their employment prospects. Layoffs have been low. They may, some may worry that the economy that the labor market will weaken,” said Yellen.
“But I think the biggest burden that’s weighing negatively on household sentiment is inflation. And that’s why that is our top priority in terms of addressing that.”
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