Janet Yellen, US Treasury Secretary said she expects the inflation rates of the US to fall to acceptable levels in the second half of the coming year.
Yellen told CNN on Sunday that monthly rates of inflation have already fallen substantially from the very high rates that they had seen in spring and early summer. She also said that because of what's already happened, the inflation rate will remain high into next year.
She said she expects improvement by the middle to end of next year, the second half of 2022. She pointed out that the Covid-19 outbreak has given a considerable amount of shock to the economy, but added, "we will be working through over the next year".
Yellen said that the covid crisis had diminished spending on services and caused a reallocation of spending toward goods. She added. the supply of goods have also increased substantially in America but pressure still remains.
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Yellen also pushed back against criticism that the US is about to losing control over inflation.
"I agree, of course, we are going through a period of inflation that's higher than Americans have seen in a long time. And it's something that's obviously a concern and worrying them. But we haven't lost control.
"As we make further progress on the pandemic, I expect these bottlenecks to subside. Americans will return to the labor force as conditions improve," the Treasury Secretary added.
Yellen's remarks came after the Labour Department recently reported that US inflation remained elevated in September as supply chain disruptions had persisted for months.
Over the past 12 months through September, the consumer price index (CPI) increased 5.4 per cent, slightly up from the 5.3 per cent pace for the 12-month period ending August, according to the Department.
