Minneapolis Fed Chair Neel Kashkari on Sunday said inflation in the U.S. will likely see “higher readings” before numbers taper off, as Americans grapple with rising prices nationwide.
“The math suggests we're probably going to see somewhat higher readings over the next few months before they likely start to taper off,” Kashkari said during an appearance on CBS’s “Face the Nation.”
Kashkari said the surge in demand for goods is a result of stimulus Congress has pumped into the economy and the effect the COVID-19 pandemic has had on the country, but noted that both “should be temporary.”
“We're seeing both a surge of demand because Congress has given a lot of money to families and businesses to get through the pandemic, but we're also seeing supply disruptions at the same time because of the COVID virus. The good news is both of those should be temporary,” Kashkari said.
“The challenge is these high prices that families are paying, those are real, and people are experiencing that pain right now. And so, we take that very seriously, but I'm optimistic that it should be temporary, even though it is causing pain right now,” he added.
Is #inflation going to get worse? @NeelKashkari predicts that prices will likely continue to increase for a few more months - the result of spending by Congress and strong demand - but still believes it will be temporary. WATCH --> pic.twitter.com/A7jgGTqJmw— Face The Nation (@FaceTheNation) November 14, 2021
The Minneapolis Fed chair’s comments come after the Labor Department released new data last week that showed that annual inflation is at a 30-year high.
The news sent shockwaves throughout the U.S., where Americans from coast to coast are seeing increased prices at gas pumps and grocery stores.
Pressed on Sunday why it will take the U.S. years to return to around 2 percent inflation, which is considered a normal level, Kashkari said “the demand side and the supply side are going to take some time to work out.”