Treasury Secretary Janet Yellen conceded Tuesday she was wrong when she predicted last year that inflation would not become a major problem for American households.

In an interview with CNN, Yellen said: “I think I was wrong then about the path that inflation would take. As I mentioned, there have been unanticipated and large shocks to the economy that have boosted energy and food prices and supply bottlenecks that have affected our economy badly that I didn't at the time … fully understand. But we recognize that now.”

Yellen and other White House officials last year claimed inflation was a temporary side effect of the steep economic recovery from the early months of the COVID-19 pandemic. 

In March 2021, Yellen said she believed there was only “a small risk” of inflation and added, “I think it’s manageable.”

In May of last year, she said, “I don't anticipate that inflation is going to be a problem.”

But consumer prices continued to rise, and in March inflation hit 8.5% compared to a year earlier — a 40-year high — before falling slightly to 8.3% in April. Gas prices, meanwhile, continue to set record highs almost every day. On Wednesday, the average price for a gallon of regular fuel was $4.67, according to AAA.

New COVID-19 variants, lockdowns in China and the Russia-Ukraine war have all contributed to soaring costs. Critics of President Joe Biden also have blamed the $1.9 trillion American Rescue Plan he signed into law last March for accelerating inflation.

Biden wrote in a Wall Street Journal op-ed Tuesday he has made “tackling inflation my top economic priority." He and Yellen met Tuesday with Federal Reserve Chairman Jerome Powell at the White House to discuss the issue, but the president has stressed he will respect the Fed’s independence. 

Last month, the Fed raised its key short-term interest rate by a half percentage point, and Powell has indicated more interest rate hikes are likely this summer.

Yellen told CNN, “We all realize what an important and huge burden inflation is placing on American households.”

Asked  if she thinks inflation might get worse in the near future, Yellen said the April consumer price report was an “encouraging sign,” but because of the uncertainty surrounding the war in Ukraine, “we can’t rule out further shocks.”