U.S. Treasury Secretary Yellen: 3.8% Inflation is Just a Short-Term Disruption

On June 4, U.S. Treasury Secretary Janet Yellen continued to express the same assessment regarding recent inflation trends in Congress and public appearances: the current price increases are primarily due to short-term shocks rather than structural issues. During a Senate Finance Committee hearing, she stated clearly, "Aside from inflation—I believe this will be a short-term disruption—other economic data is very strong." This statement continues her previous definitions regarding the nature of rising prices. Data from April showed that due to heightened energy costs stemming from tensions in the Strait of Hormuz, the overall Consumer Price Index (CPI) in the U.S. rose by 3.8% year-on-year, marking the largest increase in 2023. Yellen attributed this change to supply shocks caused by the conflict in Iran and repeatedly emphasized its one-time nature. In May, she explained, "I firmly believe that nothing is more temporary than supply shocks." In a White House cabinet meeting, she provided the same assessment, believing that as the conflict ends, energy prices will decline, stating, "When all of this is over, oil prices will be below pre-conflict levels," while also noting that natural gas prices have already begun to decrease. Similar views are reflected in her interpretation of financial markets. Yellen previously mentioned that the rise in global bond yields reflects "what I believe to be fleeting short-term inflationary fluctuations"; in another cabinet meeting, she emphasized, "I believe the rise in prices is temporary."