ANL 30.68 Increased By ▲ 1.83 (6.34%)
ASC 14.94 Decreased By ▼ -0.21 (-1.39%)
ASL 23.90 Decreased By ▼ -0.25 (-1.04%)
AVN 92.00 Decreased By ▼ -5.95 (-6.07%)
BOP 9.14 Decreased By ▼ -0.16 (-1.72%)
BYCO 10.25 Decreased By ▼ -0.10 (-0.97%)
DGKC 135.60 Increased By ▲ 0.10 (0.07%)
EPCL 50.00 Increased By ▲ 0.02 (0.04%)
FCCL 24.62 Decreased By ▼ -0.54 (-2.15%)
FFBL 24.25 Decreased By ▼ -0.97 (-3.85%)
FFL 15.60 Decreased By ▼ -0.44 (-2.74%)
HASCOL 10.74 Decreased By ▼ -0.33 (-2.98%)
HUBC 85.20 Increased By ▲ 0.20 (0.24%)
HUMNL 7.35 Decreased By ▼ -0.35 (-4.55%)
JSCL 24.85 Decreased By ▼ -0.90 (-3.5%)
KAPCO 37.85 Increased By ▲ 0.40 (1.07%)
KEL 4.15 Decreased By ▼ -0.02 (-0.48%)
LOTCHEM 14.78 Decreased By ▼ -0.35 (-2.31%)
MLCF 46.60 Decreased By ▼ -0.58 (-1.23%)
PAEL 38.25 Decreased By ▼ -1.15 (-2.92%)
PIBTL 11.80 Decreased By ▼ -0.24 (-1.99%)
POWER 10.50 Decreased By ▼ -0.15 (-1.41%)
PPL 90.55 Decreased By ▼ -0.45 (-0.49%)
PRL 26.10 Decreased By ▼ -0.59 (-2.21%)
PTC 8.95 Decreased By ▼ -0.10 (-1.1%)
SILK 1.40 Decreased By ▼ -0.05 (-3.45%)
SNGP 38.10 Decreased By ▼ -0.65 (-1.68%)
TRG 141.10 Decreased By ▼ -4.60 (-3.16%)
UNITY 31.50 Decreased By ▼ -1.40 (-4.26%)
WTL 1.57 Decreased By ▼ -0.04 (-2.48%)
BR100 4,936 Decreased By ▼ -22.94 (-0.46%)
BR30 25,403 Decreased By ▼ -330.65 (-1.28%)
KSE100 45,865 Decreased By ▼ -100.6 (-0.22%)
KSE30 19,173 Decreased By ▼ -26.07 (-0.14%)
World

Yellen says to judge Biden stimulus on speed of return to pre-pandemic unemployment

  • The current US unemployment rate is 6.3%, compared with 3.5% before the pandemic - a level widely viewed as effectively full employment.
  • Success to me would be if we could get back to pre-pandemic levels of unemployment and see the re-employment of those who have lost jobs in the service sector, particularly - I would also consider them a measure of success.
22 Feb 2021

WASHINGTON: US Treasury Secretary Janet Yellen said on Monday she will judge the success of President Joe Biden's coronavirus stimulus plan by how quickly it returns the economy to pre-pandemic levels of unemployment.

Speaking to a New York Times Dealbook online event, Yellen also played down the increased debt levels that would be incurred from Biden's $1.9 trillion American Recovery Plan being debated in Congress. She said that due to low interest rates, US interest expenses as a share of GDP are at 2007 levels.

The current US unemployment rate is 6.3%, compared with 3.5% before the pandemic - a level widely viewed as effectively full employment. But Yellen said that because 4 million people have dropped out of the labor force because of child care responsibilities during the COVID-19 pandemic, the effective unemployment rate is close to 10%.

"Success to me would be if we could get back to pre-pandemic levels of unemployment and see the re-employment of those who have lost jobs in the service sector, particularly - I would also consider them a measure of success."

Yellen said that if the federal government fails to spend the money necessary to get the economy quickly back on track, that will take a toll on US fiscal soundness, citing the long, slow recovery from the 2008-2009 financial crisis.

"So by having a stronger economy, the money that's spent partially pays for itself," Yellen said.

She said traditional metrics in assessing debt, such as the 100% US debt-to-GDP ratio, are less relevant in a very low interest rate environment.

A "more important metric" was interest payments on federal debt as a share of GDP, which at around 2% is no higher than in 2007, when interest rates were substantially higher.

The Treasury is seeking to take advantage of those rates by issuing longer-term securities, Yellen said. Asked whether the Treasury would consider a 100-year bond, she said the market for that maturity would likely be "very tiny" with "limited interest."