Treasury Secretary Janet Yellen said Wednesday that the stimulus spending signed into law by President Joe Biden to aid the U.S. recovery from the Covid-19 pandemic may have contributed “a little bit” to the country’s subsequent inflation woes.
But the widespread rise in prices that marred the Democrat’s administration was mostly “a supply-side phenomenon” caused by the pandemic itself, Yellen told CNBC’s “Money Movers” in an exit interview before leaving her role.
There were “simply huge supply chain problems,” she said, adding that shortages of critical goods “started pushing up prices a great deal.”
Yellen said she believed the $1.9 trillion Covid relief bill and other spending was necessary, and did not answer directly when asked if she has any regrets about it.
Instead, she urged Americans to recall that the pandemic was “raging out of control” when Biden took office, with thousands of people dying from the virus each month and a high unemployment rate threatening livelihoods.
“It was really important to spend the money to alleviate that suffering,” she said.
Yellen, 78, who led the Treasury throughout Biden’s four-year term, is set to be replaced by Scott Bessent, the hedge fund executive picked by President-elect Donald Trump.
Yellen said Bessent’s extensive market experience is “a very helpful background” for a candidate seeking to take charge of the agency responsible for managing the nation’s financial security.
“I’m pleased to see somebody with experience who will be will be taking over, presumably, if confirmed by the Senate,” Yellen said.
This is breaking news. Please check back for updates.
