(Reuters) – Top White House economic adviser Lael Brainard on Monday declared that the U.S. economy had turned the corner in bringing down inflation and it was now time to focus on safeguarding recent progress in the labor market.
Two days before the Federal Reserve is expected to begin a long-awaited monetary easing cycle, Brainard told a Council on Foreign Relations event in New York that inflation was returning to normal levels without the considerable job losses and growth slowdown that were previously predicted
“Today, we are at an important turning point. Inflation is coming back down close to normal levels, and it is important to safeguard the important labor market progress we have made,” Brainard said in remarks prepared for delivery.
Brainard, the former Fed vice chair who now serves as the director of the White House National Economic Council, did not say in her remarks what action the Fed should take on Wednesday, and her comments were in line with recent comments from Fed officials.
But she said President Joe Biden has emphasized the independence of the U.S. central bank, drawing a contrast with Republican presidential candidate Donald Trump’s frequent criticism of Fed monetary policy decisions during his presidency.
Brainard described the actions that the Biden administration has taken to support the recovery, from COVID relief spending to clean energy tax subsidies, but said more work was needed to help Americans cope with price pressures and higher living costs.
“It is critical to continue our work together to address affordability challenges and create more opportunities for working families and the middle class,” Brainard said.
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