Press Release - Wall Street Journal and Krugman on Inflation

Economists have consistently expected transitory inflation as the economy turns back on and we transition from a pandemic-induced shutdown to robust growth, thanks in part to President Biden's vaccination strategy and the American Rescue Plan.

Today, the Wall Street Journal reported that the recent uptick in prices is temporary and a result of the accelerated transition to robust growth.

Wall Street Journal: Rising Inflation Looks Less Severe Using Pre-Pandemic Comparisons
As consumers deal with starkly higher prices than a year ago, the Federal Reserve has maintained its stance that high inflation, the increase in the price consumers pay for goods and services, isn't expected to last very long. And while inflation's 13-year high, as measured by the annual change in the consumer-price index from a year earlier, has caused concern, the central bank restated its belief that the rise in prices is "largely reflecting transitory factors."

And, Nobel prize winning economist Paul Krugman, writing in the New York Times, points out that recent data and recent statements from the Federal Reserve have "deflated the case for a sustained outbreak of inflation".

New York Times (Krugman): The Week Inflation Panic Died
Remember when everyone was panicking about inflation, warning ominously about 1970s-type stagflation? OK, many people are still saying such things, some because that's what they always say, some because that's what they say when there's a Democratic president, some because they're extrapolating from the big price increases that took place in the first five months of this year. But for those paying closer attention to the flow of new information, inflation panic is, you know, so last week. Seriously, both recent data and recent statements from the Federal Reserve have, well, deflated the case for a sustained outbreak of inflation."

While the weekly data will continue to be volatile, the result of President Biden's leadership is clear: America is getting back on track.