This week, President Joe Biden took a “victory lap” of sorts, so the Commander-in-Chief can reassure Americans that the country is recovering from a significant economic downturn.
Yesterday, Biden said that Washington expects inflation to be in the “rear-view mirror” and that citizens “should have confidence that we’re on the right track, that we’re seeing real progress.”
But then came the economic report for August, and it didn’t go according to plan.
July saw a brief downturn in inflation and pricing but costs rose again in August and the CPI was up 8.3 percent in the year-over-year comparison. That’s one-tenth higher than July’s 8.2%.
Unfortunately, it’s all higher than anticipated; the number was supposed to go down rather than up, and the report shows that the economy remains in a very difficult position.
This could be a problem for Democrat midterm chances, which had been rising on the strength of the lower numbers seen in July, and predictions from D.C. officials that said the trend would continue.
Core prices, which strip out food and energy prices, rose 0.6 percent in August, twice as much as expected. Compared with a year ago, Core CPI is up 6.3 percent.
Grocery prices have soared and are still rising fast. Prices rose 0.7 percent in August compared with July. Compared with last August, prices of food at home rose 13.5 percent.
Eating out is getting more expensive. Restaurant prices rose 0.9 percent compared with the prior month and are up eight percent compared with a year ago.
Prices of services also rise by 0.7 percent, which is up 6.8 percent compared to August 2021. The price of goods (outside of food and energy) also rose, and core goods prices were up 7.1% year-over-year.
Gas prices were the exception in this report, as those fell by over 10%, but overall the prices are still up by more than 25% compared to where they were this time last year.
Prices of shelter – rentals and real estate – jumped again by 0.7 percent (up 6.2% compared to a year ago), and electricity prices went up 1.5% (up a whopping 15.8% year-over-year). These statistics don’t give consumers much confidence.
The question now is how much of an impact will this report have on voters, as we get closer to the November elections.
Recent polls have indicated that inflation and the economy is the #1 concern for Americans, so it’s likely that a less-than-rosy economics report will have a negative effect on the Democrat Party.
Either way, with inflation still at its highest point in 40 years and only a shadow of recovery according to these findings, our wallets could be in for more trouble.
- Consumer prices rose again in August, contradicting President Joe Biden’s “victory lap.”
- Washington economists had expected the CPI to fall and overall prices of goods and services to decline, but they rose.
- Inflation and the economy remains the #1 concern for most voters, according to many recent surveys.