Economists predict inflation will remain elevated through 2023

WASHINGTON (TND) — There is growing evidence that the current stresses on the economy may be here a little longer and that inflation may get worse before it gets better.

Smack in the middle of the season of spending, a new round of predictions from economists may cause some to scale back.

There’s the pressure at ports with container ships unable to offload their goods, trouble hiring truckers to carry those goods to stores and warehouses and the fear that skyrocketing housing prices could lead to higher rents in 2022. The ingredients to inflation continue to pile up, says economist Tara Sinclair.

“It looks like all of this is going on a little bit longer, which I think has been the story of the entire pandemic,” said Sinclair, a Professor of Economics and International Affairs at George Washington University.

A newly released survey from the National Association for Business Economics adjusted its core consumer price index — which excludes food and energy costs — to increase 6% year-over-year in the fourth quarter of 2021, instead of September's forecast of 5.1%. It also predicts the wage increase being seen will keep inflation elevated through 2023 or later.

“If employers have to pay more to their workers, they have to figure out where they’re going to get that money from and it often comes through charging higher prices,” Sinclair said.

The word “transitory” is no longer being used by White House officials to describe inflation, with GOP lawmakers blaming president Biden’s policies

“A home healthcare worker I talked to, she is in and out of her car all day long. She fills up twice a week, she said, ‘this is $40-50 extra that is coming out of my paycheck,’” Tennessee Senator Marsha Blackburn said. “Per week, just to keep gas in the car.”

The White House points to positive news on the supply chain front, saying the number of supply containers stuck has decreased by 41% because of actions the administration has taken.

A clearer picture of inflation in the U.S. will come Friday when the Department of Labor releases its assessment of the price of goods and services in the Consumer Price Index.