A new survey shows that after unprecedented monetary and fiscal stimulus measures, economists are worried about the rising inflation risk in the United States and the corresponding surge in government debt.
According to a survey conducted by the National Association for Business Economics (NABE) from February 22 to March 5, more than 60% of the economists interviewed believe that the risk of inflation is greater than in the past 20 years.
Meanwhile, nearly 90% of respondents said they were worried about the trajectory of US public debt.
Earlier this month, the U.S. Congress approved a new $1.9 trillion economic stimulus plan, which actually increased the U.S. budget deficit. With the acceleration of vaccination and the easing of business restrictions in the States during the pandemic, some economic conditions continued to improve, but the high unemployment rate continued, and the Federal Reserve kept the benchmark interest rate low.
About 41% of economists believe that the current fiscal policy is “roughly right”, up from 37% in the August 2020 survey. 34% of respondents thought the fiscal stimulus policy was twice as much as the previous survey. All responses to the latest survey were submitted before the $1.9 trillion bailout bill was signed into law.
The survey also found that nearly two-thirds of the respondents believed that structural reform was needed to solve the deficit problem, and more than one-third supported reducing spending or increasing taxes.