WASHINGTON: Budget watchers and economists have reacted angrily to US President Joe Biden's recently announced decision to t extend a pause on federal student loan, arguing that such an untargeted move could exacerbate inflationary pressures.

"Extending the debt standstill would be a gigantic windfall to doctors and lawyers, feeding more inflation and worsening the nation's balance sheet," Maya MacGuineas, President of the Committee for a Responsible Federal Fiscal, a budget watchdog group, stated.

MacGuineas stated in a statement on Tuesday that the jobless rate among college graduates with a bachelor's degree is 2%, which is in line with pre-pandemic levels and approximately as low as any time in the last two decades. "The debt freeze favours high-income Americans with advanced degrees disproportionately," she said.

"There has to be a better method to promote college affordability." Former US Treasury Secretary Lawrence Summers stated on Twitter that the administration's decision to postpone student debt payments "once again" is "extremely hard to explain from a policy standpoint."

Summers, who has been warning about the dangers of increasing inflation since February last year, said, "Wherever one stands on student debt relief, this strategy is regressive, uncertainty-creating, untargeted, and unsuitable at a time when the economy is overheated."

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