U.S Commerce Secretary Gina Raimondo said Tuesday, the United States is pressuring Taiwanese semiconductor manufacturers to allocate some of their supply to American automakers grappling with a shortage of the crucial components,

Washington also is looking for ways to spur domestic production of a range of industrial components as it aims to reduce its reliance on foreign suppliers, particularly those in China, Raimondo said during an appearance at an Americas Society event.

Taiwanese high-tech chip foundries are some of the world’s biggest and most advanced, and Taiwan Semiconductor Manufacturing Company (TSMC) is the world’s largest.

“We’re working hard to see if we can get the Taiwanese and TSMC, which is a big company there, to prioritize the needs of our auto companies since there’s so many American jobs on the line,” she said.

Officials from other countries also are urging Taiwan to help with the crunch for the vital chips, the vast majority of which are produced in Asia.

Detroit automakers have cut production and warned of hits to output due to the shortage, with Ford last week saying it will cut its second-quarter production by half.

The supply crunch also has raised worries throughout the personal electronics universe, generating potentially higher prices for popular gadgets like game consoles and computer tablets.

“Right now we make zero percent of leading edge chips in the United States. That’s a problem, we ought to be making 30 percent because that matches our demand,” Raimondo said.

“It is definitely the case that we have to reshore much of our supply chain,” she added.

President Joe Biden in February issued an executive order calling for a 100-day review across federal agencies of semiconductors and three other key items: pharmaceuticals, critical minerals and large capacity batteries.

US interest rates may have to increase “somewhat” to keep a lid on inflation if President Joe Biden’s latest spending proposals are enacted and the economy heats up, Treasury Secretary Janet Yellen said Tuesday.

But after her comments set off a mini-firestorm and sent stock prices tumbling, Yellen later clarified that she was not predicting nor suggesting the Federal Reserve should raise rates.

After winning approval for a $1.9 trillion pandemic rescue plan in March, Biden has made two more proposals totaling nearly $4 trillion over a decade and partially paid for with tax increases on corporations and the wealthy.

The goal is to revamp the US economy after the Covid-19 pandemic caused a severe downturn in 2020.

“It may be that interest rates will have to rise somewhat to make sure that our economy doesn’t overheat,” Yellen said in a pre-recorded conversation with The Atlantic.

However, she said “the additional spending is relatively small relative to the size of the economy” and is over a larger time frame than the pandemic rescue spending, which focused on immediate needs of workers and families.

Though Yellen acknowledged the higher growth “could cause some very modest increases in interest rates,” the United States needs the investments “to be competitive and to be productive.”

The Federal Reserve has pledged to keep interest rates near zero until employment recovers and inflation holds above its two-percent target level for some time, but economists and investors are increasingly sounding the warning that government spending will cause an inflationary spiral.

Fed Chair Jerome Powell and others have tried to tamp down those concerns, saying price increases in the short term are due to the rebound from the unprecedented impact of Pandemic, as well as temporary supply issues as economic activity resumes.

European and US equity markets mostly fell Tuesday, with the Nasdaq slumping on valuation concerns after US Treasury Secretary Janet Yellen said interest rates could rise.

Yellen, in a pre-recorded conversation with The Atlantic, said US lending rates may have to increase “somewhat” to keep a lid on inflation if President Joe Biden’s latest spending proposals are enacted and the economy heats up.

The remarks added to pressure on stocks, especially the tech-rich Nasdaq, which has prospered during the pandemic due to the Federal Reserve’s policy of near-zero interest rates.

Investors have been fretting for weeks about the risk of higher inflation and a sudden shift in Federal Reserve policy.

After her comments set off a mini-firestorm and sent stock prices tumbling, Yellen later clarified that she was not predicting nor suggesting the Fed should raise rates.

Still, the Nasdaq finished down nearly two percent.

Earlier, major European indices all ended the day lower, with Frankfurt tumbling 2.5 percent as all stocks on the DAX 30 saw losses, the greatest of which were among industrial and tech companies.

Equities are sitting around record or multi-year highs after a more than year-long rally, and there is a feeling that they are in store for a small correction soon, before resuming their upward march.

European stock markets rebounded at the open on Wednesday from a sharp drop the previous day on valuation concerns.

Investors nevertheless remain on edge after US Treasury Secretary Janet Yellen hinted that US interest rates might need to be increased as government spending measures fan inflation and the economy surges.

In initial deals, London’s benchmark FTSE 100 index rose almost 0.6 percent to 6,960.97 points compared with the closing level on Tuesday.

In the eurozone, the Paris CAC 40 index opened with a gain of 0.5 percent to 6,284.09 points and Frankfurt’s DAX 30 rallied 0.9 percent to 14,985.05.