Lower gasoline costs, driven down artificially by Biden raiding the American strategic petroleum reserve, slowed U.S. inflation for a second straight month in August, but most other prices across the economy kept rising - evidence that inflation remains a heavy burden for American households.
Consumer prices surged 8.3% last month compared with a year earlier, the government said Tuesday, down from an 8.5% jump in July and a four-decade high of 9.1% in June. On a monthly basis, prices rose 0.1%, after a flat reading in July, reported New York’s ABC News 7.
Core prices jumped 0.6% from July to August - up sharply from 0.3% the previous month and dashing hopes, for now, that core prices would moderate. And in the year ending in August, core prices jumped 6.3%, up from 5.9% in July. Rents, medical care services and new cars all grew more expensive last month.
Inflation is higher than many Americans have ever experienced, escalating families’ grocery bills, rents and utility costs, among other expenses. It has deepened gloom about the economy despite strong job growth and low unemployment, reported Christopher Rugaber of the Associated Press.
Forty percent of U.S. adults specifically name inflation in an open-ended question as one of up to five priorities for the government to work on in the next year, according to a June poll from The Associated Press-NORC Center for Public Affairs Research. That’s a sharp rise from 14% in December and less than 1% the year prior. In all, 77% mention the economy in any way, up from 68% in December. But just 10% specifically mention jobs or unemployment, as U.S. employers continue to hire despite high inflation and weak economic growth.
Economists see core prices as typically providing a clearer read on where costs are headed than overall inflation. Stock prices tumbled and bond yields jumped on the worse-than-expected core figures, with many investors fearful that the Federal Reserve will turn even more aggressive in its drive to curb inflation. The Dow Jones industrial average sank more than 800 points in early trading, reported ABC News 7.
Further Fed rate hikes could weaken growth so much as to push the economy into a recession. Some economists now expect the Fed to raise its benchmark short-term rate, currently in a range of 2.25% to 2.5%, to 4.5% or higher. That would make it even harder for the central bank to meet its goal of achieving a "soft landing, whereby it tames inflation without causing a recession.
“This was a disappointing report,” Laura Rosner-Warburton, senior economist at MacroPolicy Perspectives told The Washington Post. “It raises the risk of higher interest rates and a hard landing for the economy.”
The Washington Post further reported Chair Jerome Powell is expected to announce another big increase in the Fed’s key rate next week, which will lead to higher costs for consumer and business loans.
Associated Press public opinion research shows Americans increasingly call their personal finances a major issue: 44% mention it, up from 24% in December and 12% the year before. That includes more mentioning gas or energy prices (33% now vs. 10% in December) and food costs (9% vs. less than 1%).
Although gas prices dropped 6.1% in April this year from the month before jumping in subsequent months, and gas prices are still 26% higher than last year reported Taylor Tepper of Forbes Advisor.
Mr. Tepper reported the news was less cheerful when it comes to another staple: food.
The price of buying groceries and dining out surged again in August, and are now 13.5% and 8% higher than a year ago, respectively. The overall food index gained 11.4%, the biggest 12–month jump since May 1979.
Supermarket News explained the food CPI — including food-at-home and food-away-from-home — dipped month over month in August but climbed on an annual basis. BLS said the food index edged up 0.8% for August, down from monthly increases of 1.1% in July, 1% in June, 1.2% in May, 0.9% in April, 1% in March, 1% in February, and 0.9% in January. Over 12 months, the food CPI was up 11.4%, surpassing a gain of 10.9% in July and still well above annual hikes of 10.4% in June, 10.1% in May, 9.4% in April, 8.8% in March, 7.9% in February and 7% in January.
All six major grocery store food group indices rose for August, but not as much as in the previous month, according to BLS. The cereals and bakery products index saw the largest monthly increase at 1.2%, while the index for other food-at-home advanced 1.1%. Rising 0.5% in August were the indices for meat, poultry, fish and eggs; fruit and vegetables; and nonalcoholic beverages. The only good news was in the dairy and related products CPI, which inched up 0.3% month over month, which BLS said was the smallest increase in that index since November 2021.
Senator Mike Braun of Indiana probably spoke for all Republicans when he released a statement about President Joe Biden’s yesterday afternoon at the White House billed as a “celebration” of the so-called “Inflation Reduction Act,” the tax-and-spend spree that continues to drive the Bidenflation agenda that has produced the highest rate of inflation in 40 years:
“Today, Joe Biden is holding a ‘celebration’ for his latest inflation bomb spending bill, as new consumer numbers show another month of crushing high prices. This is an insult to every American struggling to make ends meet this month.”
Even Democrats are starting to admit the Bidenflation disaster. In response to the latest inflation figures Harvard economist Jason Furman, Chairman of President Obama's Council of Economic Advisors, tweeted: The median CPI, which excludes all the large changes in either direction and is better predicted by labor market slack, is out and is extremely ugly. A 9.2% annual rate in August, the single highest monthly print in their dataset which starts in 1983 (second highest was in June).
The Capitol Switchboard is (202) 224-3121, call your Representative and Senators TODAY, tell them you demand an end to the Democrats’ unconscionable spending spree that is driving Bidenflation.
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