(NewsNation) — President Joe Biden told The Associated Press on Thursday that the American people are “really, really down” after a tumultuous two years with the coronavirus pandemic, volatility in the economy and now surging gasoline prices that are hitting family budgets.

Earlier this week the Federal Reserve raised interest rates by 0.75%, the largest increase since 1994, in an effort to tackle inflation. That hike spurred a downturn in the stock market on Thursday as the economy continues to waver under high interest rates and inflation.

Fed Chair Jerome Powell said another rate hike was likely next month.

Biden said, however, a recession is not inevitable and bristled at claims by Republican lawmakers that last year’s COVID-19 aid plan was fully to blame for inflation reaching a 40-year high, calling that argument “bizarre.”

As for the overall American mindset, Biden said, “People are really, really down.”

“They’re really down,” he said. “The need for mental health in America, it has skyrocketed, because people have seen everything upset. Everything they’ve counted on upset. But most of it’s the consequence of what’s happened, what happened as a consequence of the COVID crisis.”

Analysts still fear a recession could be on its way if the Fed continues to increase interest rates and the market reacts negatively. The Fed’s most recent interest rate increase was expected by investors, but the immediate consequences of it and speculation of another hike coming have stoked recession fears.

“Essentially, with the Fed hiking rates more and of course Fed Chair J. Powell saying another rate hike was very likely next month in July, that’s when people started to consider ‘wait hold on, this might mean we are actually going to head to a recession now’ and that’s not good for anyone either,” said Kirstin Myers, editor-in-chief of The Balance.

Speaking to the AP in a 30-minute Oval Office interview, Biden addressed the warnings by economists that the United States could be headed for a recession.

“First of all, it’s not inevitable,” he said. “Secondly, we’re in a stronger position than any nation in the world to overcome this inflation.”

The president said he saw reason for optimism with the 3.6% unemployment rate and America’s relative strength in the world.

“Be confident, because I am confident we’re better positioned than any country in the world to own the second quarter of the 21st century,” Biden said. “That’s not hyperbole, that’s a fact.

Some have suggested the U.S. could be headed toward a “shallow recession,” which would mean the economy would slump but there would be “no long-term economic pain,” Myers said.

“By having that little recession, that shallow recession, it gives us the opportunity to really bring that inflation down and then start stimulating the economy again so it can start running but not run too hot,” Myers said.