Janet Yellen warns that inflation decline may not be “smooth”

Exclusive: Treasury Secretary Janet Yellen said on Wednesday that inflation may face a difficult return to normal after successive reports showed that price pressures within the US economy rebounded at the beginning of the year.

In an interview with FOX Business' Edward Lawrence, Yellen responded to fears of stagflation and emphasized that progress on inflation has not stopped.

“I don't expect this to be a smooth path from month to month, but the trend is clearly favorable,” she said. “However, President Biden’s top priority is to address the issue of high costs that concerns many Americans.”

Janet Yellen, US Treasury Secretary, during a House Financial Services Committee hearing in Washington, D.C., on Tuesday, February 6, 2024. (Photo by: Valerie Blish/Bloomberg via Getty Images/Getty Images)

Prices for everything including groceries, new cars and health insurance rose in 2021 and 2022 as a result of rampant inflation, which was caused by pandemic-induced disruptions to the global supply chain, a very tight labor market and increased consumer demand fueled in part by stimulus cash.

While inflation has fallen significantly from its peak of 9.1% during June 2022, it remains above the Fed's target of 2%. When compared to January 2021, shortly before The inflation crisis beganPrices rose by a staggering 18.49%.

It has created high inflation Severe financial pressure For most American families, having to pay more for daily necessities like food and rent. The burden is disproportionately borne by low-income Americans, whose already stretched salaries are severely affected by price fluctuations.

People shop at a home improvement store in Brooklyn on January 25, 2024 in New York City. ((Photo by Spencer Platt/Getty Images)/Getty Images)

“I don't think we're going to see stagflation,” Yellen said. “Most forecasters believe we are on a path where inflation will decline over time.”

This is a developing story. . Please check back for updates