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Yellen says inflation not ’embedded’ in U.S. economy, research to boost capacity

HERNDON, Va., Oct 21 (Reuters) – U.S. Treasury Secretary Janet Yellen said on Friday that inflation was not becoming “embedded” in the U.S. economy and domestic investments in semiconductors and research would help increase U.S. productive capacity.

Yellen, speaking to reporters at a technology business incubator near Dulles International Airport, said she sees no signs of higher inflation expectations over the medium term being built into wages and prices.

“I don’t believe it’s becoming embedded in the U.S. economy,” she said of inflation when asked about recent Consumer Price Index data showing persistent increases in non-food, non-energy core inflation factors, including rents.

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Yellen said the report showed more work was needed to bring inflation down, but there also were some early signs of producer costs easing, in metrics such as supplier deliveries and shipping costs,…

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