The WSJ editors cited Fed Chairman Jerome Powell as saying, on the matter of our current relatively high inflation rate,
…some people define transitory to mean “short-lived.” But at the Fed “we tend to use it to mean that it won’t leave a permanent mark in the form of higher inflation.”
This is misleading. It’s good that he’s not anticipating permanently higher inflation—if he’s right—but that’s unlikely in nearly any event—so far.
The permanent mark of importance here is the higher price levels that have already resulted from the present inflation level. Even when the inflation rate falls to a more normal level, those price levels will be unlikely to fall commensurately in nominal terms, and it’ll be a long while before productivity or wages or both rise enough to reduce those price levels, in real terms, to their prior level.