The White House said Monday that the three-year battle against soaring inflation has reached a “critical tipping point” and it is important to protect progress in the job market.
“Inflation is returning to near-normal levels, and we cannot protect the important labor market gains we have made,” Lael Brainard, head of President Biden’s National Economic Council, said in a speech at the Council on Foreign Relations. It’s important.”
His comments come as officials declare they are confident that inflation is returning to its 2% target and that attention is turning to calming the economy, with the Federal Reserve’s ) was issued as the central bank is poised to cut interest rates for the first time in four years this week. labor market.
In his final speech in Jackson Hole, Wyoming, in late August, Fed Chairman Jay Powell said the Fed is “committed to supporting a strong labor market as we move further toward price stability.” said. He said the Fed is not “seeking or welcoming further cooling of labor market conditions” and that the current level of policy rates gives the Fed “ample room to cut rates in response to a weakening job market.” He pointed out that he was giving.
Brainard said the administration’s policies to support supply chain bottlenecks and address rising commodity prices, as well as a commitment to respecting the Fed’s independence, are contributing to the rebound in inflation. .
“This was an important contrast to his predecessor (Biden), who repeatedly criticized the Federal Reserve’s monetary policy during the previous administration,” Brainard said.
Mr. Brainerd will address affordability challenges, including building millions of new affordable housing units and providing incentives for states and local governments to remove outdated barriers to construction. He emphasized the administration’s policies and efforts to achieve this goal. He also emphasized the importance of expanding the workforce by subsidizing high childcare costs and investing in clean energy, semiconductors and AI to create jobs.
“This is an approach that weakens the economy by undermining the independence of the Federal Reserve and the rule of law, adds trillions of dollars in debt, and imposes $4,000 worth of sales taxes on middle-class households. “It’s very different,” she said.
