The Wall Street Journal reports that the $1.9 trillion bailout passed by Congress is expected to help the U.S. economy achieve its highest growth rate in nearly 40 years and reduce poverty, but it will also bring inflationary concerns this year.
Economists surveyed by the Wall Street Journal believe that with the latest round of bailouts and higher vaccination rates, the U.S. economy is expected to grow at 5.95 percent this year, up from 4.87 percent predicted last month and the highest growth rate since 1983, when it was 7.9 percent.
The chief U.S. economic expert of Oxford Economics said that the nearly $4 trillion in spending approved by the U.S. Congress last year to combat the New Guinea virus Epidemic was an unprecedented response. He expects that the latest round of bailout can make the U.S. economy grow by 3 percentage points and create 3 million to 3.5 million jobs.
However, the economy is overheated also caused Inflation followed by doubts, the Federal Reserve may raise interest rates to cool down, will cause impact on the economy and the job market.
Among the economists surveyed by the Wall Street Journal, 80.6% believe that the latest round of bailout cases will allow the inflation rate to exceed 2% set by the Federal Reserve, but 85% of economists believe that the Federal Reserve will not raise interest rates until next year or later.
Economists expect the inflation rate to reach 2.8% by the middle of this year, and then gradually decline. Dacor said: “Inflation will be close to 3% by mid-year, but it will not reach the level of runaway overheating.”
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