By Kate Davidson 

WASHINGTON -- Treasury Secretary Janet Yellen said Tuesday that it is possible the Federal Reserve may have to raise interest rates to keep the economy from overheating if the Biden administration's spending plans are enacted.

President Biden has proposed roughly $4 trillion of new spending on infrastructure and social programs over the next decade, including funding for roads and bridges, research and development, affordable child care and paid family leave.

"It may be that interest rates will have to rise somewhat to make sure that our economy doesn't overheat, even though the additional spending is relatively small relative to the size of the economy," she said in a prerecorded interview at the Atlantic's Future Economy Summit.

(END) Dow Jones Newswires

May 04, 2021 14:13 ET (18:13 GMT)