Fed still underestimates inflation risk, says Larry Summers

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Former US Treasury Secretary Lawrence H. Summers has made headlines in the US since the end of last year when he said the package of direct payments to citizens, the size that was being proposed, was “a serious mistake” and could generate higher inflation desired.

Speaking to Brazilian investors this Tuesday, 14, Summers commented on his positioning and inflation risks by participating in the MacroDay 2021, event of BTG Pactual bank (from the same group that controls the EXAM).

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The professor was Treasury secretary in the Bill Clinton administration, between July 1999 and January 2000, in addition to having participated in the Barack Obama administration, and was vice president of the World Bank, among other positions.

Summers has appeared in the American debate as one of the names most concerned about inflation, and he reiterated his more cautious view on the subject.

He said on Tuesday that he has “a lot of respect” for the team at the Federal Reserve, the US central bank, and that he believes they are very prepared to decide, but he still sees an underestimated notion of risk.