Inflation, deficit under Trump would be worse than under Biden, WSJ’s survey shows By Investing.com

According to a report in the Wall Street Journal this week, most economists expect inflation, deficits and interest rates to be higher under a second Trump administration than they would be if Biden remained in the White House.

Citing its quarterly poll of forecasters conducted July 5-9, The Wall Street Journal said it received responses from 68 professional forecasters from business, Wall Street and academia.

“Of the 50 people who responded to questions about Trump and Biden, 56% said inflation would be higher under another Trump term than under Biden,” according to the Wall Street Journal. That’s compared to 16% who said the opposite, while the rest saw no significant difference.

The post explains that economists’ views on inflation and interest rates seem to be driven mostly by Trump’s policy preferences, specifically on trade and immigration.

However, they note that “these assessments are unlikely to change significantly with a different Democratic candidate.”

Analysts at the Wall Street Journal’s Economic Forecasting Group said there was a real risk that inflation would accelerate again under a Trump presidency.

The Wall Street Journal adds that economists on average expect US GDP to grow 1.7% this year after the latest inflation data, down from 3.1% in 2023 (on a year-over-year basis).

Additionally, they noted that the unemployment rate is expected to remain just above 4% through 2026, with payrolls expanding by about 131,000 jobs per month over the next year.

On average, economists are said to put the chance of a recession in the next 12 months at 28 percent. The Wall Street Journal said the forecast was little changed from its last survey in April.