Treasury Secretary Janet Yellen called China’s economic woes a “risk factor” for the US, but one that doesn’t significantly dent her optimism for the American economy.
“That said, I feel very good about US prospects overall. Let’s call that a risk,” she said, referring to China.
For the US, she said, “we’re seeing a slowdown in growth, but growth that remains healthy, a job market that is very strong and inflation that coming down.”
Yellen’s comments come days after President Joe Biden blasted China’s economic problems as a “ticking time bomb” and referred to Communist Party leaders as “bad folks.” Speaking at a political fundraiser on Aug. 11, Biden said China was in “trouble” because its growth had slowed and due to its high unemployment rate.
Read more: Yellen Sees Path to Easing Inflation, Keeping Healthy Job Market
Worries continued to mount this week over the outlook for growth in China. The yuan fell to the weakest level since November after the release of a series of disappointing economic figures. The currency has now tumbled about 5% this year, the worst performer in Asia after the yen.
By contrast, Yellen drew attention to the surprising strength of the US labor market despite the Federal Reserve’s most aggressive rate-hiking campaign in decades.
Asked why polls showed most Americans didn’t feel the economy was doing well, Yellen responded by saying their view was much more positive when they’re asked how they are doing personally.
“When Americans are asked about their own personal financial situation, 70% or more say they feel very good,” she said. “When they’re asked about the economy overall, they have weaker views.”
She also noted that Russia was suffering from the war, as well.
“The ruble has declined in value, which is a reflection of the fact that our program of sanctions with our allies, and the war, is causing a drain on the Russian economy,” she said.
Russia’s central bank called an extraordinary meeting set for Tuesday after the ruble crashed through the level of 100 to the dollar for the first time since March 2022.
