United States Treasury Secretary Janet Yellen admitted she was wrong in the past about her inflation predictions during an interview with CNN’s Wolf Blitzer.
“I think I was wrong then about the path that inflation would take,” Yellen told Blitzer Thursday on “The Situation Room” in response to 2021 comments where she claimed inflation would be “a small risk.”
When Blitzer asked if it was a mistake to “downplay” the risk of inflation, Yellen responded that unforeseen factors such as a new strain of COVID-19 and Russia’s invasion of Ukraine complicated her earlier predictions.
“As I mentioned, there have been unanticipated and large shocks to the economy that have boosted energy and food prices and supply bottlenecks that have affected our economy badly that I didn’t –at the time– fully understand, but we recognize that now,” Yellen said.
Yellen’s admission comes as the Biden administration has failed to control skyrocketing prices, with inflation hitting its highest level since 1981.
The Consumer Price Index hit 8.3% in April 2022 compared to 4.2% in 2021.
Yellen said she believed the Federal Reserve could curb inflation by increasing interest rates and shrinking its stockpile of treasury bonds.
“For our part, President Biden is focused on supplementing what the Fed does with actions we can take to lower the costs Americans face for important expenditures they have in their budget,” Yellen said.
The administration would work with Congress to boost the use of renewable energy to lower utility bills, Yellen said during the interview.