WH Economic Adviser Rouse: We Misjudged Inflation Because Thinking ‘Was Tied to the Pandemic’ – We’re ‘Still in the Midst of’ Pandemic

On Tuesday’s broadcast of “CNN Newsroom,” White House Council of Economic Advisers chair Cecilia Rouse stated that the White House incorrectly predicted inflation wouldn’t be a long-term issue because “what we understood about inflation at the time was it was tied to the pandemic. We are still in the midst of this pandemic.” And because Russia’s invasion of Ukraine has caused economic problems.

After playing clips of President Joe Biden in 2021 predicting inflation would be temporary and Federal Reserve Chair Jerome Powell predicting that inflation wouldn’t rise to major levels, co-host Victor Blackwell asked, “Those expectations, clearly wrong. Does the White House acknowledge that it got it wrong for too long?”

Rouse responded, “Well, look, what we understood about inflation at the time was it was tied to the pandemic. We are still in the midst of this pandemic. Russia’s war on Ukraine [destabilized], not only gas prices and food prices, but also disrupted supply chains. We didn’t foresee Delta. We didn’t foresee Omicron. And so, yes, there have been unexpected challenges, which have disrupted the natural — getting us back to equilibrium, which would help bring down those prices. But we are optimistic, forecasters expect that, over the coming months, inflation will ease. This is what the Fed is expecting. That’s what outside forecasters are expecting. So, as our economies heal, as the war of Russia against Ukraine, Russia has control to bring that to an end, we’re facing those challenges, but it’s really important for the American people to understand that we come into [these] challenging times with an economy that has some resilience to withstand some of those challenges.”

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