Despite President Joe Biden’s campaign promises to restore America’s economy, consumers have increasingly expressed concerns about inflation in recent months.
Now, a new Federal Reserve report indicates there are indeed some dark economic clouds on the horizon.
Crunching the numbers
According to the Washington Examiner, the central bank revealed on Wednesday that it projects inflation will reach 3.4% by the end of this year. That figure represents a significant increase from its prior estimate.
Furthermore, the Fed indicated that it expects to raise interest rates in 2023.
There is a potential bright spot in the long-term forecast, however, with the report finding that the current inflationary pressure is expected to be “transitory” with the rate dropping down to a projected 2.1% next year.
“The sectors most adversely affected by the pandemic remain weak but have shown improvement,” a Federal Reserve statement declared.
In general, the financial regulatory body determined that “financial conditions remain accommodative, in part reflecting policy measures to support the economy and the flow of credit to U.S. households and businesses.”
The bottom line
Despite those reassuring words, a recent poll conducted by Monmouth University reveals that Americans see inflation as a real concern — and many blame Biden’s policies for exacerbating it.
The survey released on Wednesday explained that a “central economic criticism of Biden’s plans is that the spending will lead to spiraling inflation.”
In fact, a majority of respondents “express some level of concern that these plans could lead to inflation, including nearly half (47%) who are very concerned about this possibility and 24% who are somewhat concerned,” the pollsters added.
A majority of Democrats — 55% — are at least “somewhat concerned” about rising consumer prices. Among independents, that number rises to 7 in 10, and among Republicans, it sits at a whopping 93%.
The poll also reflected an apparent decline in support for Biden’s economic performance overall, signaling that the share of Americans who believe middle-class families have benefited “a lot” from the current administration’s policies stands at just 19%. That figure represents a decline of 11 points from the number who said in January that they expected the incoming president’s approach to be helpful to such families.