As Americans have continued to sound off over sticker shock on retail and grocery shelves, the U.S. Treasury secretary admitted Wednesday that her public predictions were wrong.
"I regret saying it was transitory [inflation]. It has come down, but I think transitory means a few weeks or months to most people. And it's lasted longer than that," Janet Yellen told FOX Business’ Edward Lawrence in an exclusive interview.
In early June 2021, Yellen had tamped down inflationary concerns, claiming rising costs and the contributing factors were "transitory," a term used to describe temporary market conditions.
"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," Yellen said that June. "But I personally believe that this represents transitory factors."
JANET YELLEN WARNS INFLATION DECLINE MIGHT NOT BE ‘SMOOTH’
Just one year after her comments, inflation surged to 9.1%, which had not been seen in four decades. Fast-forward to this week, when Labor Department data indicated inflation unexpectedly ticked higher in February thanks to a jump in the cost of gasoline and rent, climbing to 3.2% year-over-year.
In her Wednesday interview, Yellen recognized the financial pain still being felt within the housing and rent markets.
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"Most forecasters believe we're on a path where inflation will come down over time. The single biggest contributor to inflation is housing costs. And, we can see when we look at the market for new rental apartments, that in many parts of the country, rental prices for new apartments have actually declined, overall, flat to slightly down," Yellen told Lawrence.
"It takes a while for that to filter into the CPI," the secretary continued. "And so, I have every expectation that the single largest contributor to inflation is going to be moving down over this."
FOX Business’ Megan Henney contributed to this report.
