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Biden stimulus only “small contributor” to inflation -Breaking


© Reuters. FILE PHOTO. Janet Yellen, reasury secretary, pauses during testimony before a Senate Banking Committee mixed hearing about oversight of Treasury Department and Federal Reserve on Capitol Hill, Washington, U.S.A, November 30, 2021. REUTERS/Elizabeth F

WASHINGTON, (Reuters) – The $1.9 trillion American Rescue Plan stimulus package that President Joe Biden issued in March contributed towards stronger demand, but was only a minor factor in the current higher inflation rates. U.S. Treasury Secretary Janet Yellen explained Wednesday to lawmakers.

Yellen stated to the House Financial Services Committee, that while the stimulus package clearly boosted the demand, it wasn’t fair to assume it exceeded the need or fueled inflation.

According to her, “It is true that American Rescue Plan put money into the pockets of people… and helped increase demand in the U.S. Economy, but when you consider the inflation rate and its causes that we have, it is only a very small contributor.”

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