Goldman’s Hatzius Says U.S. Inflation Rise Will Be Temporary

The coming rise in the U.S. inflation rate is likely to be transitory rather than an enduring phenomenon, according to Goldman Sachs Group Inc.’s chief economist.

“The highest inflation numbers are just ahead of us,” Jan Hatzius told Bloomberg Television in an interview on Tuesday. “I do think though that ultimately it’s going to be more temporary.”

Goldman’s Hatzius Says U.S. Inflation Rise Will Be Temporary

After years of anemic price pressures across advanced economies, signs are now mounting that inflation is picking up, with tight inventories of materials as varied as semiconductors, steel, lumber and cotton showing up in survey data.

Whether the rise in commodity prices will feed through to a sustained rise in the prices paid by consumers is a key question for policy makers and investors.

The U.S. Federal Reserve is currently buying $120 billion of bonds each month and has said it will continue to do so at that pace until “substantial further progress” has been made toward its employment and inflation objectives.

Fed Chair Jerome Powell told reporters during an April 28 press conference that it would take “some time” to make substantial further progress.

Hatzius also sees labor supply improving as the pandemic abates and schools reopen.

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