Treasury Secretary Janet YellenIt was warned Tuesday that inflationary pressures could persist in the U.S. Economy for a time.

This is less than a week following J, Federal Reserve Chairmanerome Powell called inflation “frustrating,”CNBC’s Yellen said that although the price hikes caused by various factors will eventually be reversed, she isn’t sure when.

She said that “supply bottlenecks” have been created and have led to inflation during an interview.Squawk BoxInterview. They are temporary, I believe. But that doesn’t necessarily mean that they will disappear over the following months.

Fed officials use “transitory” often to describe current Fed runs. inflation running at a 3.6% year-over-year rateAccording to the preferred gauge, it was a 30 year high. The consumer price index and other measures of inflation are much higher than the Fed’s preferred gauge. Economists suspect that the Fed might be behind this increase. understating the durability of inflation

Although the Fed wants inflation to be at 2%, they said that in its most recent consensus estimateAccording to the Federal Open Market Committee, the inflation rate will likely be at 3.7% by 2021 and then decrease in the years that follow. James Bullard of St. Louis Fed stated Monday that he believes inflation will rise as high as 2.8% to 2022, in contrast with the 2.3% forecast by the Fed.

Yellen observed the extraordinary nature of the recovery after the shortest, but most severe recession in American history. It lasted from February 2020 to April 2020.

She stated that she trusted the Fed to make good decisions. We have experienced an unusual shock. On the one hand, we are six million jobs less than we were in the Pandemic. This means that there is still a large number of job seekers. Many firms find it hard to hire.

Powell and others at the Fed (Yellen was the chair from 2014-18) have suggested they are likely to take the first steps toward reducing the unprecedented help that the central bank has given the economy. This will mean: gradually reducing the amount of bondsEach month, the Fed purchases; thereafter, there would be interest rate rises.

Yellen, like her predecessors, remains optimistic about the economic state.

She said, “We have seen extraordinary shifts in demand towards goods and away from services.” I know that the Fed is working to understand the consequences of this.

Next up is the U.S. job market. Dow Jones surveyed economists and found that they expect nonfarm payrolls growth of 500,000. Average hourly earnings will grow by 0.4% per month, and 4.6% compared to a year ago. For signs of inflation, economists will be closely watching wage increases.