Washington: US Treasury Secretary Janet Yellen said that she expected to see high inflation rates through the end of the year as the economy continues to recover from the Covid pandemic.
“My judgment right now is that the recent inflation that we have seen will be temporary. It’s not something that’s endemic,” Yellen said at a virtual hearing on Thursday held by the House Appropriations Subcommittee on Financial Services and General Government.
“I expect it to last, however, for several more months and to see high annual rates of inflation through the end of this year,” she said, adding the Treasury and economists in the White House are monitoring inflation trends very carefully.
“I came of age and studied economics in the 1970s. And I remember what that terrible period was like, and no one wants to see that happen again.”
Yellen’s remarks came after the Labour Department recently reported that consumer price index (CPI) in April rose 4.2 per cent from a year ago, the largest 12-month increase since September 2008, reports Xinhua news agency.
“The high inflation reading and the CPI that we saw last month partly reflects the fact that service prices as our economy is coming back, these prices, they’re still below where they were pre-pandemic, but they’re moving up,” Yellen explained, adding there’re also supply bottlenecks.
“I think as the economy gets back online, it’s going to be a bumpy process, but I do believe we’ll see some adjustments. I don’t think this is endemic inflation,” she said.