Deputy Treasury Secretary Wally Adeyemo anticipates that continued strong demand will help the US economy avoid a recession, amid rising concern that the nation is heading toward a downturn.
“Talking to CEOs, they made clear to me that demand for their products and services remains strong,” Adeyemo said Wednesday in an interview with MSNBC television. “That’s what small business owners are telling me as well.”
His remarks come amid growing pessimism over the outlook for the economy. Earlier Wednesday, JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon warned investors to prepare for an economic “hurricane.”
The Federal Reserve also said Wednesday in its Beige Book report that growth looks to have downshifted in recent weeks in the face of rising interest rates and elevated inflation.
Adeyemo offered a more upbeat message and said the Biden administration could take credit because of the spending packages it has shepherded through Congress.
“The reason demand remains strong is because the investments the president has made in things like the American Rescue Plan and through the infrastructure package we put together that will continue to put demand into our economy,” he said.
Government spending has been credited with helping the economy weather the Covid pandemic and bringing unemployment below 4%. But many economists have also blamed the fiscal response for fueling inflation, which reached a 40-year high in the year through March at 8.5%.
Adeyemo reprised the administration’s argument that unanticipated supply shocks and Russia’s invasion of Ukraine are largely to blame for the surge in prices.
This article was provided by Bloomberg News.