The risk the U.S. economy will slip back into recession is lower now than at any time in the past year, Treasury Secretary Timothy Geithner said on Sunday, while conceding that recovery will be slow and uneven.
In an interview on ABC News' This Week, Geithner said the U.S. economy expanded at nearly a 6 percent annual rate in the fourth quarter of 2009 and said the economy was definitely healing after the financial crisis that drove it into recession in late 2007.
This is going to take a while, and it's going to be uneven, Geithner said in an interview taped before leaving for the Canadian Arctic on Friday to attend a meeting of Group of Seven finance ministers and central bankers in Iqaluit, capital of a vast native Inuit territory called Nunavut.
ABC released portions of the Geithner transcript on Friday.
Geithner claimed there were even some encouraging signs in Friday's report on U.S. unemployment for January, which showed another 20,000 jobs lost but a dip in the unemployment rate to 9.7 percent from 10 percent in December.
He said the Obama administration is doing everything it can to enhance recovery prospects and played down chances that growth might stall and push the United States back into recession.
I think we have much, much lower risk of that today than at any time over the last 12 months or so, Geithner said.
He also dismissed an interviewer's suggestion that rising levels of U.S. indebtedness might put pressure on the U.S. triple-A ratings and potentially cause rating agencies to downgrade it.
Absolutely not, Geithner said. That will never happen to this country.
The U.S. Treasury is heavily reliant on borrowed money to fund the government's day-to-day operations, which it raises by selling U.S. notes and bonds throughout the world in rising volumes to fund budget deficits that are forecast to hit $1.6 trillion in fiscal 2011.
Geithner said there was no sign that investor interest was waning in U.S. debt and added that, to the contrary, it was sought out because of trust in the U.S. ability to repay.
If you step back and look at what has happened throughout this crisis, when people were most worried about the stability of the world, they still found safety in (U.S.) Treasuries and the dollar, he said. You're still seeing that every time.
(Reporting by Glenn Somerville; Editing by Peter Galloway)