Yellen Says Jury Out on Return to Low-Rate Era, Signaling Shift
- Treasury chief says debate continues on where rates settle
- A year ago, Yellen anticipated weak inflation would come back
Janet Yellen
Photographer: Taylor Glascock/BloombergThis article is for subscribers only.
Treasury Secretary Janet Yellen said it’s not yet clear where interest rates will settle after the volatility of the pandemic and the post-Covid recovery, suggesting a shift in her views on the issue over the past year.
“There are people who feel quite strongly that nothing fundamentally has changed, and they will eventually settle back to levels” that prevailed before the pandemic, Yellen said Friday, referring to interest rates. “But the strength of the economy also suggests that perhaps productivity growth and potential output growth have increased and the level would be higher,” she added.