US inflation will remain "elevated" in coming months but will decline once supply bottlenecks and other temporary issues are resolved, Federal Reserve Chair Jerome Powell said Wednesday. But the world's largest economy still has "a long way to go" to return to full employment following the Covid-19 pandemic, Powell said in his semi-annual testimony to Congress. Inflation has surged in recent months, with the annual consumer price index hitting 5.4% in June, the highest, the highest since August 2008. "Inflation has increased notably and will likely remain elevated in coming months before moderating," Powell said in his prepared testimony. He cited the impact of supply issues including a global semiconductor shortage that has hindered auto production, and said those factors "should partially reverse as the effects of the bottlenecks unwind."

Source: Mint July 14, 2021 12:56 UTC