28 September (WNN) — Two top government financial officials will appear in Congress on Tuesday to give an update on the US COVID-19 recovery, and note that inflation will likely hit the economy longer than previously expected.
Federal Reserve Chair Jerome Powell and Treasury Secretary Janet Yellen will testify before the Senate Banking Committee starting at 10 a.m. EDT.
Powell will tell senators that although the economy continues to make positive gains, persistent supply chain issues have helped it rise and tolerate inflation.
“Inflation has increased and will remain so in the coming months before subsiding,” Powell said in his opening statement.
“As the economy continues to reopen and spending rebound, we are seeing upward pressure on prices, especially due to supply constraints in some regions.
“These effects have been larger and longer-lasting than anticipated, but they will subside, and as they do, inflation is expected to fall back toward our long-run 2% target.”
Powell’s Federal Reserve voted last week to leave key interest rates unchanged. The Fed hasn’t raised rates since the coronavirus pandemic struck.
In her testimony, Yellen will say the US economic recovery has been “delicate but rapid” – and that some are being challenged by the spread of the delta coronavirus variant. The more contagious stress has directly led to increased restrictions across the country with economic consequences.
Yellen said in his opening statement, “While our economy continues to expand and recover a large portion of the jobs lost during 2020, significant challenges from the delta version stifle the pace of recovery and present substantial barriers to a vibrant economy.” does.”
“I remain optimistic about the medium-term trajectory of our economy, and I expect that we will return to full employment next year. A rebound like this was never a foregone conclusion. In fact, the US recovery from other wealthy countries.” stronger than that.”
Stubborn inflation has become a buzzword among Republicans like Senate GOP leader Mitch McConnell — and a focus among progressive Democrats who are working on a $3.5 trillion spending package in Congress.