U.S. inflation hits a 40-year high in June, but Biden points to decreasing gas prices
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WASHINGTON — U.S. inflation reached a 40-year high for June as prices for gas, food and rent increased, according to the latest Consumer Price Index from the Bureau of Labor Statistics on Wednesday.
Consumer prices for all items increased 9.1% for the 12 months ending in June compared to last year, the biggest year-to-year increase since the period ending in November 1981. May consumer prices were up 8.6%.
“While almost all major component indexes increased over the month, the largest contributors were the indexes for shelter, used cars and trucks, medical care, motor vehicle insurance, and new vehicles,” according to the report.
President Joe Biden, who is traveling overseas, issued a statement saying the inflation numbers already are out of date because they don’t reflect a decrease of about 40 cents a gallon in average gasoline prices during the last 30 days.
“Those savings are providing important breathing room for American families,” Biden said. “And, other commodities like wheat have fallen sharply since this report.”
White House officials also tried to get ahead of the report on Tuesday, saying the decrease in gas prices is significant. Prices have fallen from $5 a gallon in mid-June to an average of $4.63 nationwide, according to data from AAA.
“That elevated price in June is both out-of-date to where the market is today and out of date to what American consumers, more importantly, are actually experiencing today,” a senior White House official told reporters on the press call.
Polling shows the inflation issue is a problem for Biden, whose approval ratings hit a low of 33% in a New York Times/Siena College poll published this week. The Times said widespread worries about inflation and the economy are contributing.
Officials on the call had not seen Wednesday’s CPI report.
White House economic officials on the call also said because of the ongoing war between Russia and Ukraine, the administration expects oil prices to be in flux. Officials said they do not expect food prices to lower.
“The food commodity prices can be rather volatile,” a senior White House official said. “But unlike with energy and gas and oil, we haven’t really seen the same kinds of decreases in food over the last month, so that is an ongoing challenge, and it’s something that we are also paying attention to.”
The CPI report found that the food index increased 1% in June, following a 1.2 % increase the prior month.
Biden in his statement said he will do “everything I can” to continue to drive down gas prices, including pressing industry to increase production. “Oil and gas companies must not use this moment as an excuse for profiting by not passing along savings at the pump,” he said.
He also said he will continue to ask Congress to act on price reduction measures for prescription drugs, health insurance premiums and utility bills, and oppose any measures by Republicans to increase taxes on working people.
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