National Housing Conference President States Federal Reserve’s Rate Increases Risk Stagflation

by Channing Hamilton

WASHINGTON, D.C. — David Dworkin, president and CEO of the Washington, D.C.-based National Housing Conference, warns that the series of ongoing interest hikes by the Federal Reserve to fight inflation raises the risk of stagflation. Stagflation is characterized by a high rate of inflation, slow economic growth and elevated level of unemployment.

“As I stated previously, raising interest rates further to control inflation is no longer the answer and is instead contributing to an increase in the cost of shelter,” explains Dworkin. “The Federal Open Market Committee needs to let the economy absorb the previous rate increases while we focus on increasing housing supply to address skyrocketing shelter costs.”

Dworkin adds that the Federal Reserve’s indication that it may step back from taking further action will not address the nation’s affordable housing shortage, which has been exacerbated by inflation. Dworkin emphasizes the need for federal support through legislation such as the Neighborhood Homes Investment Act and the Affordable Housing Credit Improvement Act, which he states will create 2.5 million affordable housing units over the next 10 years if enacted.

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