Treasury Secretary Lew says no sense of financial crisis developing

By Martin Crutsinger
AP Economics Writer

WASHINGTON (AP) - U.S. Treasury Secretary Jacob Lew says that the decision of British voters to leave the European Union is "an additional headwind" for the U.S. and global economies but "there is no sense of a financial crisis developing."

In a CNBC interview Monday, Lew said, "I am not saying there will not be an impact on markets but it has been an orderly impact so far."

Lew said it would be important for economic policymakers to signal that they are prepared to use the tools they have to promote economic growth and "not overreact to a volatile day here and there."

Signaling concerns that countries might try to intervene in currency markets for trade advantages, Lew said, "We have made it clear that unilateral actions to intervene would be destabilizing."

In a later appearance in Washington, Lew said that the Obama administration would work closely with officials in London and Brussels, the headquarters of the European Union, as well as with other major international partners to "ensure continued economic stability, security and prosperity in Europe and globally."

Lew said he has been in regular contact with finance ministers from other countries as well as financial market participants around the world and "we will continue to consult closely in the days, weeks and months ahead."

In his interview, Lew said the United States would not offer a suggestion on the timing for Britain's exit from the EU, saying that should be left up to Britain and the EU. He said what would be critical during the transition was maintaining confidence in financial markets.

Lew signaled that the Obama administration planned to keep pushing for a vote in Congress this year on the Trans Pacific Partnership trade agreement with countries in Asia. Critics have attacked the proposal as a trade deal that will lead to further loss of American jobs and both Hillary Clinton and Donald Trump have come out against the agreement.

Lew said TPP is "profoundly in the interest of American workers and the American economy" and said it would be a big mistake for America to "step away from the world."

Published: Wed, Jun 29, 2016