US Treasury Secretary Janet Yellen on Monday tried to calm market and investors’ fears of inflation, and threw support behind President Joe Biden’s relief package.

After the Senate passed the $1.9 trillion relief bill on Saturday, the yield on 10-year US Treasury notes has extended their rally to a sixth consecutive weekly increase by rising another 2.9% during Monday trading hours.

The recent rally has stemmed from concerns about the possibility of rising inflation, but Yellen played it down, and said worries amid the relief bill triggering a rapid increase in inflation are “misplaced.”

Yellen told MSNBC that Biden’s relief bill “is a tremendously important package that will bring hundreds of millions of Americans the relief they need”.

The bill plans to allocate a massive $350 billion to state and local governments, which are “suffering from declines in revenues and extra expenses due to the pandemic,” according to Yellen.

“We expect the resources here to really fuel a very strong economic recovery,” Yellen said, adding she expects American economy will be back to full employment next year.

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