In contrast to President Joe Biden’s guarantee that price increases were a transient impact of COVID-19, John Catsimatidis, the billionaire owner of supermarket chain Gristedes, warned Monday, July 19, that inflation would drive up grocery prices by October.
According to FOX Business, Catsimatidis claimed in an interview on “Varney & Co” that he expects “a 6% annualized rate of inflation” by October. Catsimatidis claimed that increasing costs affect both the food and energy industries.
Catsimatidis, who is also the CEO of the Red Apple Group, a real estate and aviation firm, made the prediction a week after it was reported that consumer prices in the U.S. grew at their quickest rate since August 2008.
When asked how the increased prices will affect customers, Catsimatidis told Ashley Webster on FOX Business that food businesses had no choice but to “pass it on otherwise you’re not doing your duty to guard your country, your employees and your company.”
The New York-based supermarket company CEO made his remarks just a week after the Labor Department reported that prices increased by 5.4% year over year, with prices rising every month this year. Prices were expected to grow 4.9% yearly, according to analysts polled by Refinitiv.
According to the agency, the consumer price index (CPI) increased 0.9% in June, quicker than the 0.6% in May. Last month, used automobile prices increased by 10.5%, accounting for more than a third of the overall rise.
While Catsimatidis did not provide a detailed forecast for oil prices, merely stating that he expects “higher numbers” in the sector, he predicted that food prices would rise by 10—14% by Oct. 1.
The comments from Catsimatidis came on the same day that Vice President Joe Biden described inflation as “temporary” and “expected,” citing price increases as “transitory effects” of the COVID-19 outbreak.
Biden said that two bills he wants Congress to pass this year would assist in lowering inflation.
Biden claims that his spending proposal will “will enhance our productivity,” allowing for salary increases “without raising prices.” He also stated that his strategy would not cause further inflation, IB Times reported.
Those two bills proposed by the Biden administration are the supplemental $3.5 trillion budget reconciliation bill and a bipartisan $1.2 trillion infrastructure bill.
The president’s latest remarks follow a recent PBS NewsHour/NPR/Marist poll, which found that inflation is the top economic concern for 26% of respondents this year.
As firms battled to alleviate supply-chain bottlenecks caused by the epidemic, higher prices flowed into vast sections of the economy. In addition, supplemental unemployment benefits have encouraged workers to stay at home, causing some businesses to struggle to locate workers.
According to CNBC, U.S. Treasury Secretary Janet Yellen acknowledged that there would be a few more months of “rapid inflation” before it returns to normal levels “over the medium-term.”
The Federal Reserve has stated that the price increases are “transitory,” and that once the pandemic-related dislocations are resolved, prices will return to pre-pandemic levels.
Fed Chairman Jerome Powell, on the other hand, has stated that the timing is “uncertain.”