MNI BRIEF: Higher Inflation Could Last to Year-end: Yellen

Treasury Secretary Janet Yellen Thursday said higher annual inflation readings could last into year-end, but ultimately should be temporary even as White House and Treasury officials are watching inflationary trends very closely. In testimony before Congress, Yellen said she expects it to last "for several more months, and to see high annual rates of inflation through the end of this year."

Yellen said data will remain "bumpy" with supply chain bottlenecks, a shortage of semiconductors, and unusual used car price rises, but there remains "a lot of slack" in the economy with millions of job openings.

"I don't believe that will be inflationary, but we're watching that carefully and have tools to address it," the former Fed Chair said when asked whether Biden's USD1.9 trillion relief package that passed the Congress earlier this year will overheat the economy. Former Fed officials have told MNI that the longer transient inflation spike this year could challenge the Fed's framework adopted in August last year.