Yellen says COVID spending may have contributed ‘little bit’ to inflation

WASHINGTON (Reuters) – The Biden administration’s spending on stimulus to keep the economy going during the COVID pandemic may have contributed a little bit to inflation, U.S. Treasury Secretary Janet Yellen said in an interview on CNBC on Wednesday.

Yellen said supply chain issues and shortages were the main factor driving up prices during the pandemic, but conceded that stimulus spending could have played a role as well.

She said the labor market had cooled but was in a good state, and recent U.S. economic data suggested that interest rates could remain higher than people had expected.