Harvard economist Kenneth Rogoff predicts inflation will continue into next year.
“It's not so easy to raise interest rates to fight inflation when public and private data is high, when the stock market is high, when housing prices are high, when the economy is still weak,” Rogoff told Fox Business' Maria Bartiromo. “It takes a lot of stomach.”
Rogoff predicted, since policymakers at the Federal Reserve must balance the need to stop runaway inflation by raising interest rates while at the same time avoiding a recession, they will probably be “cautious” and will not drastically raise rates. This is why “we'll still have inflation in 2023,” Rogoff said.
Inflation has skyrocketed from 1.4% to 7% since President Joe Biden took office last year, and, if Rogoff is correct in his prediction, will dominate his tenure in office.
A CBS poll released Sunday found nearly 50% of voters described themselves as “disappointed” with Biden's presidency and 40% described themselves as “nervous.” Only 25% said they were “calm” or “satisfied.”
There were 58% responding the Biden administration was not paying enough attention to the economy as a whole, and 65% said the administration was not paying enough attention to inflation.
Rogoff believes the Fed takes its 2% inflation target “seriously,” but says, “I think the question is: How much are they going to have to step on the breaks to really slow inflation down？”
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