Yellen signals openness to paring tariffs on imports from China

US Treasury Secretary Janet Yellen said the administration was doing everything it could to help reduce prices for Americans. PHOTO: AFP

NEW YORK (BLOOMBERG) - US Treasury Secretary Janet Yellen suggested the US is open to scaling back the widespread Trump-era tariffs on merchandise imports to help provide Americans relief from the fastest inflation in four decades.

"We're re-examining carefully our trade strategy with respect to China," Yellen said Friday (April 22) in an interview on Bloomberg Television's Balance of Power with David Westin, when asked about removing the tariffs.

"It's worth considering. We certainly want to do what we can to address inflation, and there would be some desirable effects. It's something we're looking at."

Research from the Peterson Institute for International Economics last month estimated that eliminating a wide array of Trump-era tariffs, including those on Chinese goods, could reduce inflation by 1.3 percentage points.

The consumer price index showed inflation hit 8.5% in the year through March and in opinion surveys is a major source of public discontent with the Biden administration.

Yellen said the administration was doing everything it could to help reduce prices for Americans, releasing portions of the Strategic Petroleum Reserve and attempting to help resolve supply chain issues.

Yellen also repeated her call for big changes to international financial institutions, like the International Monetary Fund and World Bank, formed after World War II.

"The goals of each of these institutions are appropriate but the world has change in very significant ways," Yellen said.

The IMF was formed to address single-country problems while the last three major crises - the global financial breakdown in 2008-09, the pandemic and Russia's invasion of Ukraine - have all affected multiple countries.

The demand for what she called "public goods" - needed to shore up public health systems and fight climate change, for instance - outstrips the World Bank capacity for financing.

"Maybe a more fundamental rethink for the World Bank is appropriate," she said.

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