Yellen says high inflation locked in for the rest of 2022

Treasury Secretary Janet Yellen said that “unacceptably high” prices are likely to stick with consumers through 2022, but that strong personal finances will stave off a recession.

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“We’ve had high inflation so far this year, and that locks in higher inflation for the rest of the year,” she said Sunday on ABC’s “This Week.”

However, with the high stockpile of savings among Americans coming out of the pandemic and an “extremely strong” labor market, a recession is not “at all inevitable.” She said a gasoline tax holiday is “worth considering” if it could help consumers weather inflation.

US inflation accelerated to 8.6% in May, a fresh 40-year high that signals price pressures are becoming entrenched in the economy. Those figures dashed any hope that inflation was starting to ebb, prompting the Federal Reserve to unleash its biggest interest-rate increase since 1994.

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