Most economists surveyed wall street journal said former President Donald Trump's policies were more likely to reignite inflation than those of President Joe Biden.
Of the 50 economists who responded to questions about Trump and Biden in the survey, 28 said there was a greater risk of inflation returning to high levels under plans proposed by Republicans than under plans proposed by incumbent Democrats.
Eight economists polled by The Wall Street Journal said inflation would be worse under Biden than under Trump. Another 14 said the differences between the two agendas were negligible.
Economists and Wall Street analysts say Trump's tough tariff proposal – a 10% tariff on all imports, plus 60% to 100% tariffs on China – could increase producer costs, leading to Consumer prices rise.
Trump also hopes to crack down on immigration, which could cut off the source of immigrant workers who have boosted the strong U.S. labor market without reigniting inflation.
Meanwhile, several economists who see Biden as a bigger inflation threat have cited massive spending plans.
Still, 51% of economists polled by The Wall Street Journal estimated that the federal deficit would rise further under Trump, who has proposed making his first-term tax cuts permanent. Meanwhile, 22% of economists said the same about Biden, in part because Democratic support for government spending is at an all-time high.
The Biden campaign has begun promoting the new investigation in support of Biden's re-election.
Biden-Harris 2024 spokesperson Sarafina Chitika said, “While inflation is falling and manufacturing is booming under President Biden, experts are debating Trump’s policies. A clear warning of what the agenda may bring”.
The Trump campaign did not respond to CNBC's request for comment on the investigation.
The findings released Thursday add to a growing number of economists, including 16 Nobel laureates, who have previously called attention to what they see as the inflationary dangers of a second Trump term.
The survey, conducted between July 5 and 9, was released a day after the monthly consumer price index showed inflation fell 0.1% in June from the previous month.
It's the first time in more than four years that consumer prices have fallen on a month-to-month basis, an optimistic sign for the U.S. economy, which has been struggling to recover from extremely high inflation in the wake of the Covid-19 pandemic.
The survey comes as questions remain about Biden's political prospects as the Democratic presidential nominee.
Since he showed alarming weakness in a June debate with Trump, Democrats on Capitol Hill, donors and some voters have increasingly poll said they believed the president should drop out of the race and the party should choose a new nominee.
Biden has so far resisted pressure to withdraw, defiantly promising to stay in the race and trying to shift the conversation back to Trump.
In a high-stakes news conference on Thursday, Biden raised familiar warning signs about Trump's economic agenda, which includes tough broad-based tariffs, an extension of tax cuts and pressure on the Federal Reserve to cut interest rates. .
A new survey of economists on Friday appeared to support Biden's argument. But many economists point out that the president may have less power over the economy than any candidate is willing to admit.
Rather, the health of the economy can be attributed in large part to a series of policies and decisions by the President, Congress, independent government agencies, and the Federal Reserve, as well as external forces beyond anyone's control.