Yellen: There’s ‘More Distress’ in Low-Income Households, But Households ‘Generally’ in ‘Very Good’ Shape

During an interview with CNBC released on Monday, Treasury Secretary Janet Yellen said that “Some low-income consumers are perhaps exhausting their buffers of saving[s] that they built up during the pandemic, we’re seeing a little bit more distress at the household level there.” But despite that, “we’ve got a good, strong economy” with “very strong domestic demand” that is “on a solid track” and “generally, households are in very good financial shape.”

CNBC host Sara Eisen said, “I guess I’m just wondering if the economy continues to hold up, no matter what happens on the Fed.”

Yellen responded, “I think that we’ve got a good, strong economy. We’ve got very strong domestic demand. Consumers are holding up. Some low-income consumers are perhaps exhausting their buffers of saving[s] that they built up during the pandemic, we’re seeing a little bit more distress at the household level there. But, generally, households are in very good financial shape. Our financial system is generally quite strong. I don’t — things can always happen. There’s always recession risk. Geopolitical developments could create risk to our economy. But I think we’ve got a good, strong economy that’s on a solid track.”