Federal Reserve Chairman Jerome Powell, in remarks to be delivered Tuesday, cautioned Washington legislators that the causes of the recent rise in inflation may last longer than anticipated.
In a speech that he will deliver to the Senate Banking Committee, the central bank chair said economic growth has “continued to strengthen” but has been met with upward price pressures caused by supply chain bottlenecks and other factors.
“Inflation is elevated and will likely remain so in coming months before moderating,” Powell said. “As the economy continues to reopen and spending rebounds, we are seeing upward pressure on prices, particularly due to supply bottlenecks in some sectors. These effects have been larger and longer lasting than anticipated, but they will abate, and as they do, inflation is expected to drop back toward our longer-run 2 percent goal.”