President Joe Biden has dismissed concerns that the U.S will be forced to experience inflation as the recovering economy slowly takes place in light of the pandemic. He further cautioned restaurants and the hospitality industry that for them, the recovery process might take a while.
Near-term inflation. Due to the economy trying to pick up where it left off, but most economists believe that long-term inflation is near impossible so this will probably be something temporary. He further iterated that restaurants and tourism industries will be ‘in a bind for a while’ with countries uncertain about the widening spread of the Delta variant, with borders still under control and travel restrictions still in place. Restaurant owners cited the challenges they faced in hiring workers.
“Inflation is driving the cost of everything through the roof,” Senate Minority Leader Mitch McConnell of Kentucky said at a news conference. Inflation has become a political liability for the White House even more so after the U.S experienced the largest surge in consumer prices in 12 years just last month.
Some even blamed Biden for their difficulty in hiring workers after he made unemployment benefits more generous even if all that was to stem the ongoing crisis during the pandemic, they said that it caused Americans to rely on said benefits instead of returning to work. Biden responded by saying that they should pay higher wages in response, citing rising wages as a feature of his economic plans. With the rising cost of living, the move made a lot of sense but is a bitter pill to swallow for business owners. Even as job openings have hit a record high, the unemployment rate still remains on the trajectory.
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Source : TheEdgeMarkets