Inflation could hit 9%, top economist Mohamed El-Erian warns

After inflation soared to 8.6% in May, top economists and businessmen are sounding the alarm about the economy and warning that a recession could be on the way.

On CBS News’ Face the Nation on Sunday, Mohamed El-Erian, Allianz’s chief economic adviser, warned that inflation in the United States might reach 9%.

When inflation fell to 8.3% in April from an all-time high of 8.5% in March, some people thought it was finally under control. That decreasing trend, on the other hand, turned out to be a blip in a nearly year-long ascent.

El-Erian said on CBS’ Face the Nation, “I never shared those hopes,” adding that experts should adopt a more cautious approach to managing inflation.

“And I fear that it’s still going to get worse,” he added. “We may well get to 9% at this rate.”

Despite the Federal Reserve’s efforts to contain growing prices by changing its benchmark interest rate twice in the last year, once in March and again in May, the inflation rate surged in May.

El-Erian, the president of Queens College in Cambridge and the chief economic advisor of financial services firm Allianz, spoke on CBS about the economy’s current state of play, first outlining the circumstances that have led to the current rise in inflationary pressures, including Russia’s invasion of Ukraine.

“The Federal Reserve mischaracterized inflation and fell behind,” El-Erian said, adding that the Fed didn’t respond soon enough, according to him, the bank’s credibility suffered as a result, as did its ability to easily control the problem.

“You cannot get on top of inflation expectations until you regain credibility,” he said, adding that he expects the Fed to hike its interest rate by another 50 basis points following Federal Open Markets Committee (FOMC) meeting this week.

According to the latest inflation report from the Bureau of Labor Statistics, while housing, airline flights, and used and new vehicles witnessed the largest price increases in May, practically all other products increased in price as well. “It’s making us feel insecure,” El-Erian said of inflation’s current reach.

7 Responses

  1. Thank you so much POS in the WH! This one will go down in your name and it will stay that way! You should be so proud after 50 plus years your name will go down in history of this Country! Is you heart beating a little faster now because you are at the top of the list of the worst president in the history of this Country! You and your puppet masters, Obama, Gates, Soros and Zuckerberg should be really proud that they got you elected- 2000 Mules good old Zuckie and it was all his money! You four people (not a name i would use however) are the worst of the worst! And JFK issued Soros citizenship in this Country! Will the next person that is in the Oval office please pitch that POS out of this Country – never allow to return for any reason

  2. You hit it right…no more words needed…..just Prayers for our great country to last until the mid terms……A couple of good election results in some states including Texas, soooooo I think we are on the right track with Trump supporting.

  3. I am no longer REP. Or DEM or Independent. I am just a fed-up American with all the idiots running this crashing country!!!!!!!!!! Elections!! going to screw dems. This will NEVER HAPPEN! Mail in ballots, No ID, no proof of citizenship. The greatest privilege as a US citizen!!!!!!!!! No proof need??? I go to local dollar store I need Proof to buy FFFDKKKGGG tobacco What hell is going on in this WORLD ?? Whether not you believe the words of BIBLE we are on a fast traveling hand cart to hell , and no elections is going to stop this end time. Only when who or what is in control of the universe say enough is enough will these dems , repb. get their just do’s. If aliens are running the world I would think ET has more sense than all these morons put together!!!!!!!!!!!!!!!! WAKE UP AMERICA

  4. The remedy is clear & easy.
    Step 1 – remove the $1T of so from circulation & prices will come back down.
    Obviously there are too many worthless negotiable instruments aka soft currency chasing goods & services.
    Step 2 – Retire the debt based monetary system, backed by NOTHING.
    Step 3 – return the USA to lawful money of the USA, aka hard currency which is gold ore silver.

  5. Wow. katman. You have a properly working BRAIN ! The Gov. can not have people like you thinking. It makes them look BAD! So the only cure for your type is a GREAT RESET in this country or a lobotomy. or I know : send you back to kindergarten and let the teacher decide if your a boy or girl or fury animal. Then you will be a good socialist like they want. Power to the people’ wrong power to the gov.

Leave a Reply

Your email address will not be published.