US President Joe Biden sought to allay fears about inflation, saying the price spikes hitting Americans in their pocketsbooks was just temporary and that the economy continued to improve
WASHINGTON - President Joe Biden on Monday sought to tamp down concern about spiralling prices that threaten to dent the US economic recovery, saying the current inflation rise is "temporary" and not a long-term problem.
He also said one of the best ways to keep the American economy on track was for Congress to pass a major bipartisan infrastructure package that faces a looming deadline this week in the US Senate.
The global supply chain has faced challenges in getting back up to speed following the crisis caused by the coronavirus pandemic, leading to price spikes on many products.
"Some folks have raised worries that this could be a sign of persistent inflation, but that's not our view," Biden said in a White House speech.
"Our experts believe, and the data shows, that most of the price increases we've seen were expected and are expected to be temporary."
The Democratic president also said that "no serious economist" is suggesting that unchecked inflation is on the way.
"My administration understands if we were to experience unchecked inflation over the long term, that would pose a real challenge to our economy," Biden acknowledged.
"So while we're confident that isn't what we're seeing today, we remain vigilant."
Biden's effort at reassurance came as US stocks tumbled more than 2.5 percent by mid-day Monday amid resurgent fears over the coronavirus and worries about inflation pinching global growth.
Biden stressed that while the United States will experience economic "ups and downs" in the coming months, the overall state of the economy is healthy.
Despite the "predictions of doom and gloom" six months into his administration, the economic growth rate has surged to its highest level in nearly 40 years, with forecasters doubling their projections for 2021 growth to seven percent or higher, he said.
Biden is meanwhile pushing Congress to take action on his sweeping domestic agenda, a multi-trillion-dollar plan to reshape government intervention in American society with the largest federal investments in a generation.
The US Senate is poised to take the first step in that move Wednesday, with a test vote on a historic bipartisan infrastructure package to fix and upgrade the nation's roads, bridges, ports and broadband internet connections.
"We should be united in one thing: passage of the bipartisan infrastructure framework which we shook hands on," Biden said.
But the language of the bill has yet to be finalized, as lawmakers grapple with how to pay for the $579 billion in new spending.