U.S. Treasury Secretary Janet Yellen said the U.S. economy is strong but slowing in some areas, while stressing that efforts to bring inflation down will remain a priority.
According to reports from Bloomberg and Reuters, Yellen pointed out in an interview with CNBC on Wednesday (June 7) that banks may face problems related to commercial real estate. The current diversified banking system of strong community banks, regional banks, and large banks is a strong point for the U.S. economy, but banks may also face some consolidation.
However, Yellen also emphasized that the banking system is well capitalized and liquid and should be able to withstand the pressure as a whole.
She commented that the recently reached agreement to suspend the federal government’s debt ceiling is a “victory” for the American people, and emphasized that the current “primary task” is to reduce inflation, and the government continues to support the Fed’s efforts in this regard.
Yellen warned that if the inflation problem is not resolved, it may usher in a recession and trigger a financial crisis.