Editor’s Note:  Somehow the word irony seems insufficient. Both as FED Chairman and Treasury Secretary Janet Yellen went along with a spendthrift Congress and President, and had the Federal Reserve purchase huge quantities of new treasury debt, making it easier for politicians to spend money we don’t have.  In doing so, she expanded bank reserves and lending. She also monetized debt that was injected into the economy by directly paying citizens and expanding all manner of government programs. There is not a hint in her comments that monetary expansion could possibly play a role in inflation and that she and her central banker colleagues have anything at all to do with it. Nor does she fault the stupid decision to lock down the economy as a response to a virus. The fact that citizens are desperately trying to return to normal, she basically cites as the cause of inflation. Notice as well the subtle  shift in language from inflation is “transitory” to “it should level out eventually.” Thanks a bunch, Madam Secretary.

As more federal data show a major spike in inflation, another top federal official said the U.S. is in for more aggressive inflation for the rest of 2021.

Federal officials have been pressed to speak on rising inflation after \data released earlier this week showed that the all items index increased 5.4% over the last 12 months, the biggest spike since the 2008 financial crisis.

Treasury Secretary Janet Yellen commented on the rise in inflation, saying it would grow worse this year.

“Well, I think we, we will have several more months of rapid inflation, so I’m not saying that this is a one-month phenomenon,” Yellen told CNBC’s “Closing Bell.”

Yellen went on to say it should level out eventually.

“But I think over the medium term, we’ll see inflation decline back toward normal levels,” Yellen added. “But, of course, we have to keep a careful eye on it. You know, measures of inflation expectations I think still look quite well contained over the medium term. Those expectations are actually a driver of price setting behavior. And so it is important that we monitor it carefully. But I believe fundamentally, you know, that this is something that will settle down.”

That promise of “rapid” inflation growth for months raised eyebrows.

The comments come after Federal Reserve Chairman Jerome Powell sparked controversy with his testimony at a Congressional committee hearing earlier this week. He predicted a similar path as Yellen, saying inflation “will likely remain elevated in coming months” but should taper off by next year.

“Inflation has increased notably and will likely remain elevated in coming months before moderating,” Powell said in his prepared testimony. “Inflation is being temporarily boosted by base effects, as the sharp pandemic-related price declines from last spring drop out of the 12-month calculation. In addition, strong demand in sectors where production bottlenecks or other supply constraints have limited production has led to especially rapid price increases for some goods and services, which should partially reverse as the effects of the bottlenecks unwind. Prices for services that were hard hit by the pandemic have also jumped in recent months as demand for these services has surged with the reopening of the economy.”

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This article was published on July 16, 2021 and is reproduced with permission from The Center Square.