Please try another search
Economy1 hour ago (Mar 28, 2022 01:06PM ET)
© Reuters. FILE PHOTO: White House Council of Economic Advisers Chair Cecilia Rouse joins White House Press Secretary Jen Psaki (not pictured) for the daily press briefing at the White House in Washington, U.S. May 14, 2021. REUTERS/Jonathan Ernst/File Photo
WASHINGTON (Reuters) -Russia’s war in Ukraine will drive energy and food prices higher, but inflation rates should still ease in the coming year, U.S. President Joe Biden’s top economic adviser said on Monday.
Cecilia Rouse, who chairs the White House Council of Economic Advisers, said the $5.79 trillion budget plan for fiscal 2023 released by the White House on Monday was based on assumptions locked in on Nov. 10, well before the invasion, but the economy was generally stronger than expected then.
“There’s tremendous uncertainty, but we and other external forecasters expect that inflation will ease over the coming year,” Rouse told reporters as the White House released the budget proposal, which must now be considered and enacted by a deeply divided Congress.
Rouse said the White House would revise its economic assumptions later in the year, incorporating the war in Ukraine and its impact on inflation.
As locked in last November, the budget proposal assumed real expansion of the U.S. gross domestic product of 2.8% in fiscal 2023 compared to 4.2% in fiscal 2022 and 5.5% in fiscal 2021.
It assumed a 2.3% increase in the consumer price index in fiscal 2023, down from a 4.7% increase in fiscal 2022 and a 4.6% increase in fiscal 2021.
In November, Rouse told reporters, the White House had forecast that inflationary pressures would ease as the economy started to normalize with a lessening of supply chain pressures, rolling back of fiscal support for the economy, and interest rate hikes by the Federal Reserve.
Russia’s invasion would “create additional price pressures over the coming year” but the fundamental factors underpinning the economy should continue to improve, she said.
Rouse gave no specific forecast for the impact of the war or how much it could increase the rate of inflation.
Related Articles
Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.
Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.