The United States Secretary of the Treasury, Janet Yellen, said Tuesday in an interview with CNBC, that a failure to raise the legal debt limit could damage the dollar’s reserve status and cause a recession, as reported by Reuters.
Yellen added that she considers the October 18 as the deadline and said it is up to US House Speaker Nancy Pelosi and Senate Democratic Leader Chuck Schumer to figure out how to raise the cap in Congress. Additionally, Yellen noted that she supports bipartisan action to resolve that issue.
Asked about the possibility that Jerome Powell continue to lead the Federal Reserve for a second term, Yellen said that depends on a decision by President Biden. He stated that he is confident that the Fed will make the right decisions and that the central bank is trying to overcome the effects of the supply chain problems.
The dollar the market remains unchanged on Tuesday, with the dollar index rising 0.15%, just shy of 0.15%. Yellen’s comments had little impact.
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