US stagflation risk is significant and rising, experts say
Path of tariffs will largely determine level of risk, academics tell Central Banking
Leading economists have told Central Banking that recent figures on growth and price rises, combined with president Donald Trump’s tariffs, mean there is an alarming risk of stagflation in the US.
The Federal Reserve Bank of Atlanta estimated on March 18 that the US would post negative growth of -1.8% in Q1. Its previous reading, on March 3, forecast an even greater contraction of -2.8%. Personal consumption expenditure inflation in the US was 2.5% year on year in January.
David Wessel, senior
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