According to the Department of Labor, the rate of inflation, known to Republicans as ‘Bidenflation,’ in the US increased to 9.1 percent in June after previously reaching 40-year highs. This is the new record since 1981. The Bureau of Labor Statistics’ Consumer Price Index increased 1.3 percent from the previous month.
Experienced economists forecast CPI to increase by 8.8 annually and an increase of 1.1 percent from one month to the next. Due to rising costs for basic essentials like food, housing, gas, utilities, and transportation, inflation is particularly difficult on American families. Huge jumps in gasoline prices in June, which several times reached new all-time highs, started to affect both households and businesses.
For a more accurate prediction of future inflation than the headline figure, economists look to a subcategory of inflation that excludes fuel and food costs. This increased by 5.9 percent in June compared with the same month last year. It increased by 0.7 percent for the month. Both rates exceeded economists’ expectations.
The 13th consecutive month with inflation running over 5%. This means that this year’s high prices are on top of last year’s record-breaking increases.
The yearly increase in grocery store prices was 12.2 percent, and the monthly increase was 1 percent. The cost of energy has increased by 7.5 percent since May and 41.6 percent yearly. The price of gasoline increased by 11.2 percent in June compared to May, or 59.9 percent annually.
Given that some major retailers said they were offering discounts to move inventory, there had been some optimism that clothing inflation might slow down. Clothing costs increased 0.8 percent in the month and by 5,2 percent from a year ago, said the report.
Consumer prices stayed low throughout President Donald Trump’s term, despite the claims of many economists and anti-Trump journalists that his tariffs would raise them. Trump’s tariffs were absorbed by Chinese exporters and producers as well as by the profit margins of the majority of major American businesses.
After years in which it frequently fell below the Fed’s two percent objective, inflation only started to pick up speed last March. The Fed had opted to keep interest rates low in 2021. Additionally, the American Rescue Plan, which the Biden administration pushed through, included billions of dollars in deficit expenditure. As a result, prices increased as demand for products and services grew faster than supply could keep up.
The Biden administration and the central bank’s credibility were undermined by rising inflation as it continued to surge. Late last year, Fed representatives stopped using the word “transitory” and started indicating that they would be raising interest rates this year. Democrats on Capitol Hill were compelled to give up their plans for significant social transformation spending on so-called “human infrastructure.”
The general opinion of President Biden’s ability has drastically changed. Many Americans believed the administration’s assurance that inflation would subside proved that the government wasn’t concerned about the trouble of families who had to pay more for food and gas. Biden is currently the least popular president in 75 years, according to recent polls.
In other news, Joe Biden has been called worse than Jimmy Carter by critics.