With the economy looming large in the 2024 election, Treasury Secretary Janet Yellen said Thursday she sees “no reason” for a recession this year and insisted consumers are turning more optimistic about their finances.
“I think 2024 is going to be a very good economic year,” Yellen told ABC News Correspondent Elizabeth Schulze in an exclusive interview in Chicago.
“Consumers and households feel confident enough about their own personal financial situation and about the economic outlook to be spending in a way that’s creating jobs, creating growth and is providing them with the income to go on doing that,” Yellen said. “So, I see no reason why that can’t continue.”
Treasury Secretary Janet Yellen speaks during an interview with ABC News’ Elizabeth Schulze, on Jan. 25, 2024.
ABC News
Yellen’s comments come on the back of a stellar year of economic growth that defied economists’ expectations of a recession, a point that the Biden administration is hoping they can use to alter voters’ largely pessimistic feelings about the economy ahead of the election.
“Recent surveys suggest that picture is changing. We’ve seen a massive increase, improvement in consumer sentiment,” Yellen said.
Treasury Secretary Janet Yellen speaks during an interview with ABC News’ Elizabeth Schulze, on Jan. 25, 2024.
ABC News
Commerce Department data released Thursday showed the American economy grew at a faster pace than expected in the fourth quarter, capping off a strong year propelled by robust consumer spending and hefty investments by businesses and state and local governments.
At the same time, inflation steadily declined from its peak and the unemployment rate held steady, at a near-record-low 3.7%.
Treasury Secretary Janet Yellen addresses the Chicago Economic Club in Chicago, on Jan. 25, 2024.
Kamil Krzaczynski/AFP via Getty Images
But Yellen admitted that while inflation is improving, prices for everyday costs will not return to pre-pandemic levels.
“I think most Americans know that prices are not likely to fall. It’s not the Fed’s objective to try to push the level of prices back to where they were, but to stop them from rising,” she said.
Yellen also drew a sharp contrast with her generation experienced, admitting the American dream is now harder to achieve.
“When I was growing up, 80 or 90% of people in my generation did better than their parents did. And those numbers have dropped substantially. And that’s what the American dream is about.
“There are parts of the country that have really not seen much economic progress …That’s something that has to change for that feeling that the American dream is alive and well,” Yellen said.