Biden seeks to put good face on troubling inflation report

Biden seeks to put good face on troubling inflation report

President Biden Tuesday sought to put the best possible face on an inflation report that suggests the economy is far from out of the woods when it comes to rising prices.

As markets shuddered at the prospect of more economy-crushing Fed rate hikes, Biden stressed the good news that inflation has eased a bit from its red-hot spiral of a few months ago.

“Overall, prices have been essentially flat in our country these last two months,” Biden said. “That is welcome news for American families, with more work still to do.”

He pitched the continuing downward trend of gas prices and rising wages as a sign that American workers are getting the better of price hikes.

“Real wages went up again for a second month in a row, giving hard-working families a little breathing room,” Biden said.

The August report showed that prices went up by just 0.1% in the month, up from a decline of 0.1% in July.

But that modest sounding rise was entirely due to plunging energy costs. So-called core inflation, which strips out volatile food and energy costs hopped up by 0.6% in the month and is up a high of 6.3% in the past year.

As a result, the Federal Reserve Bank could raise interest rates by at least 0.75% at its meeting next week, Reuters reported.

That means American consumers and companies will have to pay more to borrow money on their credit cards, obtain financing to expand or get a mortgage to buy a home.

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With that possibility, the Dow Jones Industrial Average plummeting by nearly 1,000 points before lunchtime Tuesday.

Biden, who hoped to see continuing improvement in prices through the midterm elections, says the setback is temporary.

He planned to preside over a ceremony to celebrate the passage of his domestic spending and climate package, which Democrats rebranded as the Inflation Reduction Act.

“It will take more time and resolve to bring inflation down, which is why we passed the Inflation Reduction Act to lower the cost of healthcare, prescription drugs and energy,” the president said.

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