(Bloomberg) -- Inflation risks are mounting in the U.S. after unprecedented monetary and fiscal stimulus, according to economists who are also growing increasingly concerned about a corresponding surge in government debt.
More than 60% of respondents polled by the National Association for Business Economics say inflation is a greater risk now than it has been in the past two decades, according to a survey conducted Feb. 22-March 5.
At the same time, nearly 90% say they are concerned about the trajectory of public debt.
Earlier this month lawmakers effectively added to the U.S. budget deficit when they enacted a new $1.9 trillion economic stimulus measure. While parts of the economy continue to improve amid accelerating vaccinations and as states ease pandemic-era business restrictions, high unemployment persists and the Federal Reserve has kept benchmark interest rates low.
Some 41% find the current fiscal policy is “about right,” up from the 37% who thought this in the August 2020 survey. Thirty-four percent indicated fiscal policy was too stimulative, double the share that said so in the previous survey. All responses in the latest survey were submitted before the American Rescue Plan Act was signed into law.
Almost two-thirds of respondents believe structural changes are needed to address the deficit, with more than one-third support less spending or increasing taxes, the survey found.
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