Staff Reports
In yet another blow to the Biden administration’s claims that inflation is under control, a new inflation metric has surged in July. This puts to rest any doubts about whether inflation is a problem and supports Federal Reserve Chairman Jerome Powell’s recent statements that more interest rate hikes will be necessary. The latest Personal Consumption Expenditures (PCE) price index showed a year-over-year increase of 3.3 percent for headline PCE inflation and 4.2 percent for Core PCE inflation, which excludes food and energy prices. These numbers are higher than previous readings, indicating that prices are continuing to rise in the wrong direction.
This report also debunks President Biden’s overly optimistic remarks about inflation being “down.” The Bureau of Economic Analysis reveals that in July, prices for goods decreased by 0.3 percent while prices for services increased by 0.4 percent. Food prices rose by 0.2 percent and energy prices saw a 0.1 percent increase. When excluding food and energy, the PCE price index still increased by 0.2 percent. Compared to the same month one year ago, the PCE price index rose by 3.3 percent overall, with goods prices decreasing by 0.5 percent and services prices increasing by a whopping 5.2 percent. Food prices were up by 3.5 percent, but energy prices dropped by 14.6 percent. Excluding food and energy, the index increased by 4.2 percent.
Despite Biden Claiming 'All Is Well,' We Just Got Really Bad Economic News https://t.co/IpwPUF53WN
— David Smithers (@DavidSmithers13) August 31, 2023
The fact that the PCE price index is the Federal Reserve’s preferred inflation measure means that these upward movements are significant. Considering that prices have risen by more than 16 percent since Biden took office, it is increasingly likely that the Federal Open Market Committee (FOMC) will raise interest rates again. This is worrying news for the housing market, which has already been hit hard by higher interest rates. Buyers are finding it difficult to afford homes, sellers can’t make profitable sales, and new homeowners are stuck with high-rate mortgages.
The Job Creators Network has pointed out that rising inflation is hurting American living standards and causing problems for small businesses. The PCE inflation indicator is still over 50 percent higher than the Fed’s target rate of 2.0 percent, which is a clear sign that inflation remains a serious concern. Due to the impact of inflation under the Biden administration, small businesses and ordinary Americans are facing escalating prices and higher borrowing costs. It seems that the fight against “Bidenflation” is far from over.
