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‘Devastating’ Inflation Report Shatters Hopes of Economic Turnaround

Remember more than one year ago when the White House, President Biden, and the rest of his administration told Americans inflation was “transitory?”

Well, now more than two years into his term, Biden’s first of many attempts to avoid blame for rising prices is still being debunked anew thanks to Friday morning’s release of April’s Personal Consumption Expenditures (PCE) price index.

Considered the “preferred gauge” on which the Federal Reserve bases its monetary policy decisions, the PCE price index surged again in April, blowing past some economists’ estimates of a 3.9 percent annual advance to register a 4.4 percent increase over the year.

Core PCE — excluding more volatile food and energy costs — also beat expectations with a 4.7 percent increase, though by a smaller margin.

What’s more, April’s headline PCE number is another acceleration toward higher costs — the same faster-moving jumps seen in other inflation metrics such as the Consumer Price Index in recent releases.

That is, inflation is not just remaining elevated, it’s picking up momentum in the wrong direction:

“Another month, another devastating inflation report under this President,” reacted Rep. Jodey Arrington (R-TX), chairman of the House Budget Committee. “But Americans don’t need a report to tell them they’re paying higher prices this month than last—they’ve felt the pain of Biden’s reckless economic agenda for each of the past 25 months,” Arrington noted. “This is not a rosy economy, and it’s time for Biden to work with House Republicans on our solutions to get our spending under control, save taxpayer dollars, and get our economy growing again.”

Among other surging costs facing Americans, the PCE price index showed how the cost of shelter — which continues to accelerate and has constituted one of the largest contributors to ongoing inflation increases in recent months — is something of a runaway inflation train:

“As we predicted, inflation is rising once again,” Alfredo Ortiz, president and CEO of the Job Creators Network, told Townhall. “The PCE and Core PCE indices both increased compared to last month’s rates and remain 2.5 times the Federal Reserve’s target level,” he noted of the April PCE price index numbers.

“This worrying sign shows that Bidenflation isn’t going away anytime soon,” Ortiz continued, adding that the latest inflation data “demonstrates why Republican efforts to rein in reckless spending in the ongoing debt ceiling fight are so important in order to address this historic and persistently high inflation that’s causing so much pain for small businesses and ordinary Americans.”

The spike in PCE inflation comes as some Fed watchers were thinking Chairman Jerome Powell and the Federal Open Market Committee (FOMC) might take a “pause” on interest rate hikes that have been announced at every Fed meeting for more than one year now.

But with the Fed’s “preferred” metric showing inflation going above expectations, those who hoped for a respite from ever-increasing interest rates might have just seen their hopes dashed. Instead, Friday’s PCE price index print made another interest rate hike almost inevitable in June and added a healthy chance of another increate in July:

READ 3 COMMENTS
  • JJ says:

    If this is a transitory inflation issue then I would hate to see what a perpetual inflation would look like!! The misnomer bill – The Inflation Reduction Act – has nothing to do with reducing inflation!! In fact, it’s doing quite the opposite – it’s spending a ton more money in places that Democrats wouldn’t have gotten with any stand alone bill!!!! Democrats just don’t care!!!

  • Sue s says:

    And democrats are calling republicans “terrorists” for wanting to cut spending. We have got to cut spending. The government already has record tax dollars coming in. And we can’t afford more taxes on top of inflation.

  • EZ says:

    2 Pb vaccines can fix this

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