President Joe Biden assures US inflation is expected to be temporary

As the United States grapples with inflation amid a raging raging pandemic, President Joe Biden on Monday assured people that the current price increases were “expected” and “temporary”.

“Some folks have raised worries that this could be a sign of persistent inflation, but that’s not our view,” Biden said, during a White House speech.

Meanwhile, he also noted that enacting a large bipartisan infrastructure package, which is up for a vote in the US Senate this week, was one of the best ways to keep the American economy on track.

Following the crisis induced by the coronavirus pandemic, the global supply chain has faced challenges in getting back up to speed, leading to price spikes on many products.

“Our experts believe, and the data shows, that most of the price increases we’ve seen were expected and are expected to be temporary.”

The Democratic president also said that “no serious economist” is suggesting that unchecked inflation is on the way.

“My administration understands if we were to experience unchecked inflation over the long term, that would pose a real challenge to our economy,” Biden acknowledged.

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“So while we’re confident that isn’t what we’re seeing today, we remain vigilant.”

Biden’s effort at reassurance came as US stocks tumbled more than 2.5% by mid-day Monday amid resurgent fears over the coronavirus and worries about inflation pinching global growth.

Biden stressed that while the United States will experience economic “ups and downs” in the coming months, the overall state of the economy is healthy.

Despite the “predictions of doom and gloom” six months into his administration, the economic growth rate has surged to its highest level in nearly 40 years, with forecasters doubling their projections for 2021 growth to seven percent or higher, he said.

Biden is meanwhile pushing Congress to take action on his sweeping domestic agenda, a multi-trillion-dollar plan to reshape government intervention in American society with the largest federal investments in a generation.

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The United States Senate is set to take the first step in that direction on Wednesday, with a test vote on a historic bipartisan infrastructure plan to repair and modernise the country’s roads, bridges, ports, and broadband internet connections.

“We should be united in one thing: the passage of the bipartisan infrastructure framework which we shook hands-on,” Biden said.

But the language of the bill has yet to be finalized, as lawmakers grapple with how to pay for the $579 billion in new spending.