U.S. reviews China tariffs, possible pause on federal gas tax to curb inflation

U.S. Treasury Secretary Janet Yellen testifies before a Senate Finance Committee hearing on President Biden’s 2023 budget, on Capitol Hill in Washington, U.S., June 7, 2022. REUTERS/Evelyn Hockstein

Join now for FREE unlimited access to Reuters.com

WASHINGTON, June 19 (Reuters) – President Joe Biden’s administration is considering removing some tariffs on China and a possible pause on the federal gas tax as the United States struggles to tackle soaring prices gasoline and inflation, two senior officials said on Sunday.

US Treasury Secretary Janet Yellen said some China tariffs inherited from former President Donald Trump’s administration serve “no strategic purpose” and added that Biden is considering removing them as a way to bring down inflation.

Energy Secretary Jennifer Granholm said the president is also weighing a pause on the federal gas tax to bring prices down, telling CNN such a move is ‘not out of place’. .

Join now for FREE unlimited access to Reuters.com

The comments come as the Biden administration struggles to tackle record gasoline prices and inflation, now at their highest level in 40 years.

Cleveland Federal Reserve Chair Loretta Mester said inflation will take two years to fall to the central bank’s 2% target, “declining” gradually.

Yellen, speaking to ABC News, said the administration is reviewing its China pricing policy but did not cite specifics and declined to say when there might be a decision.

“We all recognize that China engages in a series of unfair trade practices that are important to address, but the tariffs we inherited, some serve no strategic purpose and increase costs for consumers,” he said. she declared.

Biden has said he is considering scrapping some of the tariffs imposed on hundreds of billions of dollars worth of Chinese goods by his predecessor in 2018 and 2019 amid a bitter trade war between the world’s two largest economies. Read more

US OFFICIALS SAY RECESSION ‘NOT INEVITABLE’

Both Granholm and Yellen reiterated Biden’s position that a recession was “not inevitable,” with the Treasury Secretary saying the labor market and consumer spending remained strong. Mester also said she doesn’t expect a recession despite slowing growth.

Yellen, however, described inflation as “unacceptably high” and added that she expected the economy to slow.

Whether the United States, the world’s largest economy, will slide into a recession is a growing concern for business leaders, the Federal Reserve and the Biden administration. Read more

Former U.S. Treasury Secretary Lawrence Summers told NBC News he disagreed with current officials’ assessment, saying he expected a recession.

“It’s likely that to do what is necessary to stop inflation, the Fed will raise interest rates enough to send the economy into recession,” Summers said Sunday.

Soaring inflation has made hawks out of nearly every Federal Reserve policymaker, only one of whom earlier this week opposed what was the central bank’s biggest rate hike in more than a year. quarter of century.

Join now for FREE unlimited access to Reuters.com

Reporting by Kanishka Singh in Washington; Editing by Chizu Nomiyama

Our standards: The Thomson Reuters Trust Principles.

Leave a Comment