Greenspan warns of stagflation risk

Alan Greenspan, a former chairman of the Federal Reserve, warned on Sunday that the United States economy was exhibiting the first signs of stagflation.

Speaking on the ABC television network, Greenspan said: "We are beginning to get not stagflation, but the early symptoms of it."

Greenspan added it was "critically important" that the Fed could do what was needed "to suppress the inflation rates that I see emerging, not immediately, but clearly over the intermediate and longer-term period."