A key consumer price metric used by the government to measure inflation soared 8.5% over the past 12 months, the fastest pace of inflation since December 1981, the Labor Department announced Tuesday.
The consumer price index increased 1.2% between February and March, the fastest month-over-month figure since 2005, according to the Labor Department report, meaning more bad economic news for President Joe Biden. Economists surveyed by Dow Jones projected that the CPI would increase 1.1% last month and 8.4% over the 12-month period ending in March, CNBC reported.
“We’re seeing strong inflation momentum across the board, both for goods and services,” Blerina Uruci, a U.S. economist at T. Rowe Price Group, told The Wall Street Journal.
The White House warned Monday that the consumer price index figures would be “extraordinarily elevated” ahead of the report’s release, but blamed Russian President Vladimir Putin. Gasoline prices hit record highs in March after Russia’s invasion of Ukraine, which disrupted global energy markets dominated by Russian supplies.
“Because of the actions we’ve taken to address Putin—the Putin price hike—we are in a better place than we were last month,” White House press secretary Jen Psaki told reporters Monday at a briefing. “But we expect March CPI headline inflation to be extraordinarily elevated due to Putin’s price hike.”
“We expect a large difference between core and headline inflation, reflecting the global disruptions in energy and food markets,” Psaki said.
But “core” CPI, which measures prices of all goods excluding the historically volatile energy and food categories, still rose 6.5% between April 2021 and March, the Labor Department said. While lower than the headline figure, the core inflation number reported Tuesday still represented the largest jump since August 1982.
Inflation has surged over the past several months: The consumer price index surpassed the Federal Reserve’s 2% benchmark in May 2021 and has climbed higher precipitously, according to federal data. Inflation increased a whopping 7.5% and 7.9% in January and February, respectively, before Putin ever ordered Russian troops to assault Ukraine.
Prices for new and used vehicles, rent, medical care, commodities and transportation costs like airline fares have all skyrocketed over the past year, the Labor Department’s Tuesday report shows.
“As expected, inflation soared in March,” Joel Naroff, chief economist of the Pennsylvania-based economic consulting firm Naroff Economics, told the Daily Caller News Foundation. “But it wasn’t just energy, which continued to spike as a consequence of Russia’s invasion of Ukraine. Food, clothing, medical care, and transportation were all up sharply as well.”
Although recent jobs reports have shown strong growth, Americans are more concerned about inflation when it comes to the economy, according to a CBS News poll released Monday. Just 31% of those surveyed said they approved of Biden’s handling of inflation.
Small business owners listed inflation as the biggest issue facing them, another survey released Tuesday by the National Federation of Independent Business shows.
Critics, meanwhile, have accused the Federal Reserve of failing to act properly as prices shot up across sectors over the past 12 months. Officials at the Fed turned their focus too much toward social justice issues instead of monetary policy, a recent Independent Institute report concluded.
“This is a direct result of Biden’s Federal Reserve being too preoccupied with ‘diversity,’ ‘equity,’ and ‘climate change’ while ignoring all the warning signs on inflation for more than a year,” E.J. Antoni, a research fellow at The Heritage Foundation’s Center for Data Analysis, told the Daily Caller News Foundation. “The Fed is laughably behind the curve, and people are demonstrably poorer because of it.”
Prior to the report released Tuesday, Antoni had predicted the 12-month figure to reach 8.3% and the month-over-month number to surpass 1%.
The Heritage research fellow added that, under his projections, real wages would be down over 4% since Biden took office Jan 20, 2021.
Republicans on the Senate Banking Committee repeatedly slammed the Federal Reserve for its persistent push to address climate change in recent months. The lawmakers said the Fed increasingly is focusing on issue areas outside its congressional mandate.
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