Cal State Fullerton economists Anil Puri and Mira Farka predict lower economic growth and higher inflation over the next 12 months — a.k.a. “stallflation.”
Expectations for a rapid vaccine-induced economic recovery proved to be overly optimistic due to the resurgent Delta variant, rising inflation and fiscal uncertainty.
“It is likely that the most memorable thing about 2021 will be that it is turning out to be different than what it promised at its onset,” said Mira Farka, associate professor of economics and co-director of the Woods Center for Economic Analysis and Forecasting.
Farka and Anil Puri, director of the center and provost emeritus, presented a three-year outlook for the national, California and Orange County economies at an Oct. 20 virtual conference.
The pair cautioned that the current inflationary rise has all the hallmarks of becoming something more permanent. The biggest impediment to growth over the next year will be supply constraints.
On the regional front, Puri expects home price acceleration in Orange County will wind down over the medium to long term. The two expect faster recoveries in Orange County and the Inland Empire but a slower one in Los Angeles County.