What’s happening: Biden and his team are now steeling themselves for high inflation to persist into 2022, a problem for Democrats ahead of next November’s midterm elections. Senior Fed official Richard Clarida has indicated that if inflation stays elevated, the central bank could opt to hike interest rates next year.
Inflation is currently “much more than a moderate overshoot” of the Fed’s 2% target, he said earlier this week. “I would certainly not consider a repeat performance a policy success,” he continued.
Larry Summers, an economist who served in both the Obama and Clinton…
