Yellen believes that a US default could lead to a global financial crisis

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Yellen believes that a US default could lead to a global financial crisis– “(Possible US default) This will undoubtedly cause a recession in the US economy and could trigger a global financial crisis. This will definitely undermine the role of the dollar as a reserve currency.”WASHINGTON (AA) – US Treasury Secretary Janet Yellen said that if the debt limit is not raised, a US default could lead to a global financial crisis and the role of the US dollar as a reserve currency could be undermined. in an interview with CNN. Regarding the federal government reaching the $31.4 trillion debt limit in the United States, Yellen said that the US Treasury Department has begun implementing emergency measures, that these measures will last until early June, but this is not a guarantee. Stressing that this a country that meets all its financial obligations, she said that the US government’s confidence that it can always repay its debts is the basis of the global financial system, and US Treasury bonds are “safe” assets causing a recession in the economy and could cause a global financial crisis . This will definitely undermine the dollar’s role as a reserve currency.” This has always been the case in the past.”“We are seeing really good progress on inflation”Referring to high inflation in the country, Yellen said the progress they’ve made on fighting inflation is encouraging: “I think we’re seeing really good progress on fighting inflation in the US.” Stating that inflation is still a concern for households, Yellen said supply chain bottlenecks that increase inflation have been addressed. Emphasizing that the US Federal Reserve (Fed) is independent and cannot comment on its policies, Yellen said: they are trying to do what they think is necessary to keep inflation down.” Assessing this week’s meeting with Liu Hee, China’s Deputy Prime Minister in charge of foreign trade and international economic relations, Yellen noted that the world’s two most important economies have a responsibility to cooperate on issues of global importance, including climate change. “We discussed our cooperation and determination to work together to overcome global challenges,” Yellen said. he said.
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