Economists say Federal Reserve is on ‘the right track’, expect interest rates to rise in 2015

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NEW YORK, N.Y. – A majority of economists believe the Federal Reserve is doing the right things to help repair the U.S. economy, according to a survey released Monday by the National Association of Business Economists.

The survey also showed that a vast majority of economists believe the U.S. economy is at little risk of inflation in the coming years.

In the association’s semiannual survey, 53 per cent of economists said the Fed’s stimulus programs were “on the right track” for the U.S. economy while 39 per cent thought the Fed was doing too much.

The Federal Reserve has been winding down a bond-buying economic stimulus program since December. Many investors and economists expect the central bank to start raising interest rates in 2015. It would be the first time the Fed raised interest rates since 2008. In the survey, three-quarters of the economists said they believe the Fed’s first interest rate increase will come in 2015.

More economists approve of Congress’ and the White House’s handling of the U.S. economy as well, according to the survey. Forty-two per cent of NABE economists believe U.S. fiscal policy is “about right,” while 34 per cent believe U.S. fiscal policy is “too restrictive.” A year ago, 31 per cent of NABE economists believed U.S. fiscal policy was “about right.”

When asked what would be the best long-term way to tackle the U.S.’ growing national debt, 34 per cent of NABE economists surveyed believe policymakers should use a combination of budget cuts and tax increases to balance the budget. Only 7 per cent of economists believe that the U.S. should raise taxes to deal with the budget deficit, while 25 per cent believe the U.S. should only use budget cuts to deal with the deficit.

NABE interviewed 257 economists between July 22 and Aug. 4.

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