PHILADELPHIA – MAY 8: Economic stimulus checks are prepared for printing at the Philadelphia Financial Center May 8, 2008 in Philadelphia, Pennsylvania. (Photo by Jeff Fusco/Getty Images)
UPDATED 5:25 PM PT – Saturday, April 10, 2021
Economists and investors are voicing concerns over increased inflation they believe is partially fueled by stimulus payments.
Reports from the Bureau of Labor Statistics said the U.S. Consumer Price Index climbed one percent on a seasonally adjusted basis in March, a greater rise than expected.
The highest spike was seen in gasoline prices, which jumped 8.8 percent.
These concerns came after Biden’s $1.9 trillion American Rescue Plan was criticized by GOP lawmakers for the damage it would do to the economy.
FILE – In this Dec. 1, 2020 file photo, Federal Reserve Chair Jerome Powell listened during a Senate Banking Committee hearing on Capitol Hill in Washington. (Al Drago/The New York Times via AP, Pool)
“Now we have a situation where the economy is reopening. There will be a surge in demand. Perhaps there will be bottlenecks, perhaps, but it seems unlikely that that will change the underlying inflation psychology that has taken deep roots over the course of many, many years,” Federal Reserve Chair Jerome Powell said. “So that’s what we think. We think that there will be upward pressure on prices which may be passed along to consumers in the form of price increases. We think that that effect will be temporary.”
Wall Street executives are now worried about an abrupt increase in interest rates to counteract high inflation.