The White House has pushed back on assertions that the current spike in inflation could be a permanent adjustment, arguing instead Thursday that the spike is “temporary” and would be gone by the end of 2022.
White House press secretary Jen Psaki made the announcement at a briefing with reporters on Thursday, pushing back on J.P. Morgan Chase CEO Jamie Dimon prediction that inflation is here to stay. Psaki took several questions on the topic, arguing that many financial experts both inside and outside of the government believe the inflation will pass sometime within the next 18 months.
“What is the White House’s message to average Americans, including those who are on limited income though who are experiencing higher prices right now for food and clothing and other goods and services? You mentioned it’s expected to die down next year, but what is your message to them in the meantime, is it simply just to wait it out?” a reporter asked Psaki. (RELATED: The Numbers Are In, Biden’s Inflation Is Not Going Away)
“That’s certainly not what I’ve ever said,” Psaki responded. “Our message is that we understand the threat that inflation poses. We will be vigilant about any responses needed. It’s important for Americans to know and understand that these impacts are temporary, and some of these price increases are a result of the economy turning back on.”
Inflation spiked 5.4 percent over the 12-month period ending in June, which marks the most dramatic increase since 2008, according to the Department of Labor.
“We’re in a transitional phase right now,” Joel Naroff, the chief economist at Naroff Economics, told the WSJ. “We are transitioning to a higher period of inflation and interest rates than we’ve had over the last 20 years.”
Experts have said that an increase in used car sales and the ongoing shortage of semiconductors have contributed to the inflation. The White House argues the trend is due largely to the lingering effects of the COVID-19 pandemic on supply lines, saying the industry is slower to respond to the surging post-pandemic demand.