US Treasury Secretary Timothy Geithner said on Friday that the International Energy Agency's decision this week to release government-held crude oil reserves was "sensible policy." "It will provide some modest help and relief" to the US economy, Geithner told reporters after meeting local business leaders in Manchester, New Hampshire. "It was a prudent use of existing reserves."
The Paris-based IEA on Thursday said it would tap member countries' emergency reserves - some 60 million barrels over 30 days - for only the third time since it was founded in 1974, to fill the gap in supplies left by the disruption to Libya's output. High oil prices have put "significant" pressure on the global economy, Geithner said.
Regarding budget talks in Washington, Geithner said he was confident Congress can still reach a deal, even after a top Republican lawmaker walked out of the talks this week. But he said tax increases cannot be taken out of the equation. "You need to have modest changes in revenue," Geithner said. "There is no way to do a deal without it."
He met for over an hour on Friday with local business leaders, who he said had some encouraging words about the environment they face. "Things are gradually getting better," Geithner said, adding that the US economy is still growing "a little slower" than had been expected. US economic growth in the first quarter was an annualised 1.9 percent, the Commerce Department said on Friday.
GDP was revised from a previous 1.8 percent reading. But it is still too low to be an engine for job creation when the high US unemployment rate of 9.1 percent poses a re-election challenge for Geithner's boss, President Barack Obama. The budget deal "needs to get done in a way that doesn't put too much pressure on the economy near-term," said Geithner, calling for "the right kind of balance" and a deal that does not skew too much to elements that could hinder growth.
Comments
Comments are closed for this article.