Treasury Secretary Janet Yellen said on Wednesday she expects inflation to come down from its three-decade highs in the second half of next year as pandemic pressures on the economy ease.
The Commerce Department reported Friday that consumer prices in September, as measured by the Federal Reserve's preferred yardstick, were 4.4% higher than a year ago. That was the steepest increase since 1991.
Yellen, in an interview with NPR's Morning Edition, said she believes that's largely the result of strong demand for goods during the pandemic, which has overtaxed global supply networks.
"I expect that next year, many of the supply bottlenecks that we're experiencing now in opening up our economy will recede," Yellen said. "Sometime during the second half of the year we'll see inflation rates moving back toward the 2% that we regard as normal."
Yellen spoke to NPR from Glasgow, Scotland where she's attending climate meetings.
At the talks, Yellen has been calling for the private sector to do more to fight climate change.
"The gap between what governments have and what the world needs is large, and the private sector needs to play a bigger role," Yellen said in remarks prepared for a COP26 finance meeting.
Yellen's message at COP26 in Glasgow
The U.S. joined the U.K. in backing a climate fund that aims to attract more private investment in clean technologies.
Yellen has also been meeting with banks and asset managers who have pledged to support low-carbon projects.
"We're really beginning to see the private sector make the commitments about their own lending that are necessary to achieve ambitious goals," she told Morning Edition.
While the Biden administration was not able to push parts of its agenda on climate through Congress before the Glasgow summit, Yellen expressed confidence that lawmakers would soon pass both a bipartisan infrastructure bill and a separate, Democratic-backed measure with significant funding aimed at curbing greenhouse gases.
"These two packages jointly will be far and away the biggest investment that America has ever made in addressing climate change," Yellen said.
Over the weekend, leaders of the G20 countries endorsed a global minimum tax plan that Yellen has championed.
That plan is designed to stop what Yellen has called a "race to the bottom" on corporate tax rates by requiring all countries to tax multinational companies at a rate of least 15%.
Yellen said the measure would also discourage other countries from imposing what the U.S. considers unfair taxes on American tech giants such as Google and Facebook.
"That portion of the agreement still requires some further work," Yellen said.