Federal Reserve Chairman Jerome Powell on Wednesday admitted that inflation levels were already high before Russia’s invasion of Ukraine, contradicting the Biden administration’s insistence that skyrocketing price increases are largely due to Moscow’s “special military operation” in the eastern European country.
In recent weeks, top officials in the Biden administration and Federal Reserve have publicly conceded that they made mistakes in their handling of inflation.
Behind their errors was a misreading of the economy.
Forecasters have raised their outlooks for a recession and boosted their inflation projection as the Federal Reserve faces the quandary of fast-rising prices and greater uncertainty from Russia’s invasion of Ukraine, according to the latest CNBC Fed Survey.
Inflation surged more than expected in January, notching another four-decade high as strong consumer demand and pandemic-related supply-chain snarls fueled rapid price gains that wiped out the benefits of rising wages for most Americans.
Hope is not a method
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