Central Bank Chairman Jerome Powell still expects inflation to ease; eventually, he expressed that he sees the current pressures of inflation continuing in the next year.
Assessing the current economic condition, the Federal Reserve chief said, “It’s frustrating to see the bottlenecks and supply chain problems not getting better — in fact, at the margins apparently getting a little bit worse. We see that continuing into next year probably, and holding up inflation longer than we had thought.”
Inflation by the central bank’s preferred measure has run at its hottest speed in about the past 30 years. The central bank expects the current pressures to decrease back to trend as that of pre-pandemic levels. Powell on Wednesday said that next year should be quite a strong year for economic growth.
However, central bank officials recently have acknowledged that the current inflation situations have not eased the way the Federal Reserve anticipated.
Last week, the Federal Open Market Committee (FOMC) collectively increased its projection for 2021 core inflation to 3.7% from the earlier 3% forecast in the month of June.
