Rubin: Inflation Will Stay Low
foxmarketwire.com
7.36 a.m. ET (1136 GMT) May 17, 1999
WASHINGTON — Outgoing Treasury Secretary Robert Rubin said Sunday he expected the U.S. economy to experience low inflation and solid growth in the coming months, but he warned it was risky for the world to rely on it as the only engine of economic growth.
Peter Morgan/Reuters
U.S. Treasury Secretary Robert Rubin said that he would step down from his job around July 4
Rubin, in an interview with ABC television, was questioned about whether the unexpectedly high jump in the Consumer Price Index for April meant the robust U.S. economy was threatened by higher inflation.
"As you look forward, the most likely scenario remains one of solid growth and low inflation," said Rubin, who announced his resignation last week.
Financial markets tumbled Friday after the Labor Department said its CPI, the main inflation gauge of the economy, had increased by 0.7 percent last month, the biggest monthly rise since October 1990 just before the Gulf War.
Rubin said despite the good prospects for the U.S. economy, the global economy faced a number of challenges and was still suffering from the effects of the financial crisis that erupted in 1997.
"We need to continue ... to work around the world to promote growth. We have at the moment an unhealthy situation in the world economy in that the United States is really the only major part of the global economy with robust growth," he said.
"Most particularly, it is critically important that Japan get back on track," he added.
The United States has complained repeatedly that Japan has failed to revive its economy and this has in turn exacerbated the economic downturn suffered in Asia.
Rubin, who will be succeeded in July by his deputy, Lawrence Summers, said the sound U.S. economy could be preserved by saving budget surpluses for bolstering the Social Security system rather than using them up through tax cuts. |
