You’d be forgiven for thinking the economy has been sending mixed messages lately, with stellar jobs reports coming out of Washington — and more dollars rolling into grocery bills because of inflation.
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A report on Friday showed the US added another 372,000 jobs in June, continuing a trend of economic recovery that gave President Biden a rare moment of joy while acknowledging the pain many are going through.
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This period of high inflation and low unemployment is something not seen in more than 70 years, explained University of Florida economist Dr. Amanda Fallin.
“If you’re someone worried about a recession coming, today’s jobs report was pretty good news. It came better than expected, we replaced 98% of the jobs we lost during the pandemic,” she said. “If you’re someone who worries about inflation, this is bad news. As the economy is still developing, prices continue to rise.
For most of last year, Fallin predicted that inflation would not peak until mid-2022, something she stood by in her interview on Friday. In her view, supply chain issues should begin to resolve themselves, reducing pressure on prices.
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However, she said the Biden administration could do more to make it easier, while putting pressure on corporations to increase their stockpiles to ensure this post-pandemic situation doesn’t happen again.
Fallin slightly upgraded his outlook for the future, saying the odds that the Federal Reserve can pull the nation out of inflation while avoiding a recession — a so-called “soft landing” — are better than before thanks to continued strong jobs numbers.
“If the GDP data shows that we have negative growth or have had negative growth for two consecutive quarters, a rule of thumb says yes, we are in a recession,” she said. “But our unemployment rate remains very low. It’s not even ticking up, so that means we’re doing well.”
The story continues
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She summed up her thoughts by saying that the economy is not in bad shape, nor is it in great shape. He was somewhere in between, although one’s view of him tended to be colored by his political views.
While she said it would still be very difficult to avoid a recession like never before, she said that if one did happen, it would be much less severe than 2008.
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