Treasury Secretary Janet Yellen acknowledged Thursday that “transitory” is not the best word to use to describe rising inflation in the United States.
"I'm ready to retire the word transitory,” Yellen said at a Reuters Next conference. “I can agree that that hasn't been an apt description of what we're dealing with.”
Treasury Secretary Janet Yellen says it's time to "retire the word 'transitory'" when it comes to Biden's inflation crisis pic.twitter.com/EI0GXIWNVq— RNC Research (@RNCResearch) December 2, 2021
Federal Reserve Chairman Jerome Powell also acknowledged this week that the inflation rocking the U.S. economy isn’t transitory and “that factors pushing inflation upward will linger well into next year.”
“How long does inflation have to run above your target before the Fed decides, maybe it’s not so transitory?” Senate Banking Committee Ranking Member Pat Toomey (R-Pa.) asked Powell, who appeared alongside Treasury Secretary Janet Yellen.
Powell explained that while the word has “different meanings to different people,” the Federal Reserve “tend to use it to mean that it won’t leave a permanent mark in the form of higher inflation.
“I think it’s — it’s probably a good time to retire that word and try to explain more clearly what we mean,” Powell added.
Later in the hearing, the Fed chairman vowed to “use our tools to make sure that higher inflation does not become entrenched,” suggesting an openness to raising interest rates or bringing a quicker end to the Fed’s bond-buying program. (NY Post)
The admissions about inflation come as top real estate investor Christopher Merrill told CNBC to expect "some level of inflation" to last for the next 10 years.
“I’ve heard some people say that, within 12 months, there won’t be talk of inflation,” he said. “I think it’s prudent to, as you’re doing your portfolio allocation, you’re thinking about investing, to assume that there is going to be some level of inflation in the near term, and really, for the next decade, because of how much money we’re printing right now in the system.”