“The Banking Crisis and Potential Caution from American Banks: Insights from US Treasury Secretary Janet Yellen”

By Le Figaro with AFP

Posted on 04/15/2023 at 22:24

The recent banking sector crisis could lead American banks to be more cautious, and less easily grant loans to households and businesses, according to the American Secretary of the Treasury, Janet Yellen, who nevertheless anticipates a “moderate growthof US GDP. US banks could becomea little more carefulin their operations, Joe Biden’s Minister of Economy and Finance said in an interview with CNN which will air on Sunday, but excerpts from which were released on Saturday.

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This could lead to a tightening of credit conditions which, in parallel with the rise in rates, could weigh on economic activity, but also contribute to slowing down inflation. On Tuesday, during a press conference, Janet Yellen had however indicated that she had “have not seen evidence, at this stage, of a tightening of credit conditions, although this is a possibility».

Despite the turmoil in the banking sector, the Treasury Secretary also told CNN that her forecast for the U.S. economy remains the same: “I think the outlook remains for moderate growth and a still strong labor market with falling inflation». «I don’t see anything at this time that is dramatic enough or significant enough in my view to significantly change the outlook.“, she detailed.