Washington (awp / dpa) – High inflation in the United States is temporary and pressure on energy prices should ease “in the coming months,” US Treasury Secretary Janet Yellen reiterated on Friday, saying that Biden spending plans will not create additional pressure.
“I’ll keep saying it’s temporary, although I don’t mean it’s just a matter of a month or two,” Janet Yellen told CNN from Rome where she is attending a G20 Finance meeting. .
She noted that “monthly inflation rates, although substantial, have fallen considerably from what they were just four or five months ago.”
According to her, the rise in prices is directly linked to the pandemic which disrupts economic activity.
“This created a huge demand for semiconductors,” among other things, and “increased bottlenecks,” she added.
According to her, the price increases “will normalize” and fall on a monthly basis “by the second half of the year” next.
“Annual inflation rates will fall to return to their normal level, that is to say around 2%”, also at this time, she added.
She also ruled out the possibility that Biden’s investment plans, currently being negotiated in Congress, could fuel inflation in the future.
“I do not think at all that these investments will increase inflation,” she said on CNBC, arguing that these plans of some 3 trillion dollars would be financed in particular by increases in taxes on companies.
In addition, spending will occur “slowly over the course of a decade, unlike the US $ 1900 billion bailout, which attempted to cope with the impact of the pandemic and involved a lot of spending in no time, ”she argued.
She finally stressed that these plans would increase the growth potential of the US economy, the supply potential of the economy, “which tends to lower inflation and not increase it”.
Finally, she said that “for many American families facing inflation, especially gasoline prices”, the social measures plan will instead allow them to lower higher costs, such as health care or childcare costs.
“In that sense, it’s anti-inflationary,” she concluded.
In September, over one year, inflation accelerated again to 4.4%, according to the PCE index released on Friday.
afp / buc
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