US Treasury secretary staying put to oversee billions in climate spending

US Treasury Secretary Janet Yellen is digging in to oversee billions of dollars in federal climate and infrastructure spending that she believes will transform the economy, close associates say, defying demands from Republicans to step down.

Yellen's oversight of about $270 billion in tax credits for electric vehicles homes solar panels and other climate purchases contained in the Inflation Reduction Act have made her a pivotal climate figure in President Joe Biden's administration, Reuters reports.

But the high profile, as well as signals from markets and some economists of a coming recession, are expected to intensify demands from Republicans for Yellen, 76, to step down, citing her too-rosy inflation forecasts and her failure to rein in federal spending that they say is to blame.

Yellen has also clashed with Republican lawmakers over the statutory limit on US debt, warning that a failure to raise the debt ceiling threatened America's credit rating and could disrupt financial markets.

Yellen told CNBC late last year that she was "in good company" in misjudging inflation, and that Biden's COVID spending plans were needed to boost the recovery.

She has publicly and repeatedly shaken off speculation that she would step aside midway through Biden's four-year term, steeled by what close associates say is her confidence in Biden's continuing support.

The White House and Treasury had no immediate comment on a Bloomberg report saying that Biden asked her personally to stay on.

White House and Treasury officials say inflation was spurred by supply chain problems and exacerbated by Russia's invasion of Ukraine, but note that inflation is now easing and investments in manufacturing will reduce future supply chain log-jams.

"Secretary Yellen is all-in on making sure we achieve the dual goals of reducing emissions and rebuilding American industry," Senator Ron Wyden, who chairs the Senate Finance Committee, told Reuters in an emailed statement.