As inflation continues to wreak havoc on American wallets, the U.S. dollar’s lack of purchasing power has been affecting nearly every U.S. resident’s spending decisions. On Monday, U.S. president Biden and his administration predicted lower inflation forecasts as officials announced Biden’s proposed budget for the 2023 fiscal year. According to marketwatch.com author Victor Reklaitis, the Biden administration’s inflation forecast “doesn’t look realistic.”
Biden Administration Expects ‘Inflation Will Ease Over the Coming Year’The Biden administration and White House economist, Cecilia Rouse, are predicting very low estimates as far as future inflation rates are concerned. This is despite the inflation rate in February skyrocketing to 7.9%, and rising at the fastest pace since 1982. Prices across the nation have been growing across the board and reports show that inflation is causing people to make different spending decisions. While the inflation rate jumped close to 4x higher than the Fed’s target inflation rate of 2%, rent and housing have both jumped even higher. For instance, data shows that home prices have surpassed the rate of inflation by a long shot. “Home prices have increased 1,608% since 1970, while inflation has increased 644%,” explains a recent study written by anytimeestimate.com’s Taelor Candiloro. The White House economist Rouse detailed on Monday that initially, economists expected “inflationary pressures to ease over the coming year.” But since the Russia-Ukraine conflict, Rouse stressed, the issue has “created additional upward pressure on prices.” Rouse further added:
There’s tremendous uncertainty, but we and other external forecasters expect that inflation will ease over the coming year.