Yellen urges G7 to keep up fiscal support

US Treasury Secretary Janet Yellen urged other rich nations on Saturday to keep up spending to support their economies even as the Covid-19 pandemic wanes, and said US inflation this year would be elevated but transitory.

Yellen told a news conference after G7 finance ministers met in London that they needed to invest in a fight against climate change and inequality, even after putting their economies "back on track" from the enormous hit of the pandemic.

Her comments placed a different emphasis on fiscal support than the joint statement by the G7 finance ministers, which also stressed the need to ensure long-term sustainability of public finances once the recovery takes hold.

"Most countries have fiscal space, and have the ability to put in place, fiscal policies that will continue promoting recovery and deal with some of the long run challenges that all of us face when it comes to climate change and inclusive and sustainable growth, and we urge countries to do that," she said.