Inflation rose 9.1% from June 2021 to June 2022, according to the Consumer price index, indicating that prices once again surpassed prior highs, as reported by the Bureau of Labor Statistics on Wednesday morning.
The most recent year-over-year inflation rate is greater than the Dow Jones forecast of 8.8%.
Inflation is the rate of change in the price level over a specific length of time. The CPI measures a theoretical basket of goods and services that mimics typical household spending. When individuals spend more money on items and services than their wages increase, it indicates that Americans are devoting a larger proportion of their income to purchases.
According to the Bureau of Labor Statistics, food prices increased 10.4% from June 2021 through June 2022, energy costs increased 41.6% during the same period, and new vehicle prices rose 11.4%.
“The huge deficit spending of $2.5 trillion just in FY2021 and the first 8 months of FY2022 has resulted in more money chasing after goods,” Peter St. Onge, a Heritage Foundation Research Fellow, explained to The Daily Wire. “Because government spending competes with households for resources, it raises prices by bidding away resources for government projects.”
The Biden administration prepared for the bad inflation news, which was reported this week — however, they maintained that outdated June data is affected by potential deflationary forces, especially as a result of cheaper gasoline costs. Indeed, over the previous several weeks, prices at the pump have dropped significantly after rising to $5 per gallon in early June. According to AAA, on Wednesday, the national average gas price was $4.63.
“We anticipate the headline number, which includes food and gas, to be substantially greater, because gas cost were so high in June.” White House Press Sec. Karine Jean-Pierre stated on Monday. “The president’s top economic priority is to address inflation. Over the next few months, there are a variety of reasons why we are expecting those high costs to go down.”
The White House has stated that the U.S. economy is robust, despite opposition from some in June. “I’m attempting to explain to you that the economy is in a better position than it has been previously,” said Jean-Pierre at the time. “So we feel that we are in a strong place right now and other experts feel the same as well… We think we have a good chance of fighting inflation. We have a wonderful opportunity to really start reducing prices effectively.”