Yellen concedes inflation picking up, could reach 3 percent

Treasury Secretary Janet Yellen acknowledged Saturday that inflation was growing and could peak as high as 3 percent this year as the economy recovers from the pandemic, but she insisted there was no need for alarm.

“We have in recent months seen some inflation, and we — at least on a year-over-year basis — will continue, I believe through the rest of the year, to see higher inflation rates, maybe around 3 percent,” she told reporters in London. “But I personally believe that this represents transitory factors.”

The Treasury secretary‘s comments at the G-7 economic summit provide the first concrete estimate from the Biden administration on inflation for 2021. 

For months, the White House and Federal Reserve have expected prices as supply chains struggle to keep up with growing consumer demand.