US Treasury Secretary Yellen: Economy on the path to a soft landing

United States Treasury Secretary Janet Yellen said on Tuesday that she sees no reason why inflation should not come down to the Federal Reserve’s target. Shed added that there is no reason to believe that the last mile will be especially difficult. 

Speaking at The Wall Street Journal’s CEO Council Summit, Yellen mentioned that the labor market remains strong but warned it is cooling. According to her, wage increases continue at a healthy pace. She added that it is no necessary to have high unemployment to lower inflation. 

Regarding the Fed’s policy, the Treasury Secretary explained that rising real rates may impact the decisions of the central bank. 

Market reaction

The US Dollar Index is falling modestly on Tuesday but is off lows. It recovered ground following US inflation data and is hovering around 104.00.