White House says it’s monitoring Red Sea attacks; not seeing big impact on holiday products By Reuters

© Reuters. FILE PHOTO: Houthi army helicopter flies over the Galaxy Chief cargo ship within the Purple Sea on this picture launched November 20, 2023. Houthi Navy Media/Handout by way of REUTERS/ File Picture

By Andrea Shalal

WASHINGTON (Reuters) -The White Home on Friday stated it was carefully monitoring Houthi assaults on ships within the Purple Sea, however didn’t anticipate the state of affairs to have a major impression on vacation costs or the supply of merchandise.

Lael Brainard, director of the White Home Nationwide Financial Council, informed reporters that the U.S. financial system was proving resilient, with inflation having come down sooner than even the extra optimistic forecasts had indicated, the labor market rebounding, and progress remaining strong.

However she stated the administration remained keenly alert to dangers, together with points similar to Russia’s ongoing warfare in Ukraine and its potential to disrupt grain markets, and the evolving state of affairs within the Purple Sea.

“Geostrategic dangers stay elevated. We see that additionally within the Purple Sea, the place we’re carefully monitoring and we’re working with companions,” she stated, including that there was no proof up to now to recommend an impression on costs or the supply of merchandise.

The Houthi militant group, which controls huge quantities of territory in Yemen after years of warfare, since final month has fired drones and missiles at worldwide vessels crusing via the Purple Sea, assaults that it says reply to Israel’s assault on the Gaza Strip.

The White Home has repeatedly known as for these assaults to cease. On Friday, it stated Iran was “deeply concerned” in planning operations in opposition to industrial vessels within the Purple Sea, one thing Iran denies.

Brainard stated Biden’s nationwide safety group was “very targeted” on the state of affairs within the Purple Sea, given its significance to international transport, and remained in fixed communication with ocean shippers and nations within the area to make sure freedom of navigation and to bolster regional safety.

Requested concerning the potential inflationary impression of the assaults, Brainard stated: “Based mostly on the data we now have, diversion of vessels from the Suez Canal to the Cape of Good Hope will not be anticipated to have a big impact on the supply of merchandise for vacation procuring, however in fact we’ll proceed to watch that.”