Economy41 minutes ago (Apr 06, 2021 05:05PM ET)
© Reuters. FILE PHOTO: U.S. Treasury Secretary Yellen attends economic briefing at the White House in Washington
By Andrea Shalal and David Lawder
WASHINGTON (Reuters) – U.S. Treasury Secretary Janet Yellen said a rapid U.S. economic recovery would boost overall global growth, but more work was needed to shore up weaknesses the global covid-19 crisis exposed in the non-bank financial sector, supply chains and social safety nets.
Yellen on Tuesday told leaders of the IMF and the World Bank that the Biden Administration had decided to “go big” with its covid-19 response to avert the negative “scarring” impact of long-lasting unemployment, adding that she hoped the U.S. economy would return to full employment next year.
Speaking during the International Monetary Fund and World Bank spring meetings, the former Federal Reserve chair said the crisis had dealt a huge blow worldwide, and it was the responsibility of advanced economies to ensure that years of progress in reducing poverty were not reversed by the crisis.
“We are going to be careful to learn the lessons of the (global) financial crisis, which is: ‘Don’t withdraw support too quickly,'” Yellen said, “And we would encourage all those developed countries that have the capacity… to continue to support a global recovery for the sake of the growth in the entire global economy.”
The IMF on Tuesday said unprecedented public spending to fight the covid-19 pandemic, primarily by the United States, would push global growth to 6% this year, a rate unseen since the 1970s.
Yellen said she hoped global finance officials made progress on approving a new allocation of the IMF’s emergency reserve, or Special Drawing Rights, during the meeting, and said it was critical to tackle global debt issues exacerbated by the crisis.
It was critical to ensure the world was better prepared for the next global health crisis, she said, citing the need to improve the resilience of supply chains and social safety nets around the world.
She said the core banking sector had been strengthened after the 2008-2009 financial crisis, but some areas in the non-bank financial sector “showed tremendous stress” during the pandemic and would require attention.
CLIMATE FRONT AND CENTER
Yellen, who met earlier on Tuesday with the Coalition of Finance Ministers for Climate Action, also underscored the Biden Administration’s commitment to tackling climate change at home and ensuring the needed “transfer of resources” to enable similar actions in developing countries.
“We need to make sure that we help developing countries meet their climate goals along with their development objectives. And the availability of green finance is critical to that,” she said, noting that addressing climate change would also bring opportunities for investment to the private sector.
IMF Managing Director Kristalina Georgieva said climate risks were a growing threat to economic and financial stability, and said the IMF was stepping up its efforts to standardize reporting of risks, carry out stress testing and look at the role of supervisory authorities.
The Fund was also integrating climate-related risks in its financial sector assessments, while working with other organizations to increase data on carbon intensity and other climate risks in quarterly macroeconomic reports.
It was also working with countries to help them speed up their ability to integrate climate in their macroeconomic policies, she said.
World Bank President David Malpass said the bank was finalizing a new climate change action plan that includes a big increase in spending, building on record climate financing over the past two years.
Brazil ‘back to business’ in 2-3 months as vaccinations accelerate, economy minister says
By Reuters – Apr 06, 2021
By Jamie McGeever BRASILIA (Reuters) – Brazil’s Economy Minister Paulo Guedes said on Tuesday he expects the economy will be back on track in two to three months, as an…
U.S. must invest heavily to stay No. 1 economy: White House economist
By Reuters – Apr 06, 2021
WASHINGTON (Reuters) – The United States must invest heavily in its workforce, infrastructure, research and development remain competitive and stay the world’s largest economy,…
Executives at small U.S. banks offer a jolt of optimism
By Reuters – Apr 06, 2021
WASHINGTON (Reuters) – Community bankers think of themselves as having a keen sense of the economic pulse in the cities, towns and rural areas where they do business, and if that…
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.
Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.