Tag Archives: Consumer Price Index (CPI)

The Latest News On Inflation

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On August 12, Breitbart posted an article about the current inflation rate.

The article reports:

Consumer prices inched up in July after declining sharply in June.

The consumer price index rose 0.1 percent compared with June, the Department of Labor said Wednesday. Compared with a year ago, the consumer price index is up 3.4 percent.

That matched the consensus forecast. In June, prices fell 0.4 percent while the consumer price index was up 3.5 percent from a year ago.

Core prices, a measure that excludes volatile food and energy prices, rose 0.2 percent compared with the previous month. For the year, core prices are up 2.5 percent, a decline in year-over-year inflation from the previous month’s 2.6 percent.

The moderate monthly readings across all times and core inflation, along with the decline in the year-over-year inflation rate, will likely ease concerns among Fed officials. Prices of fed funds futures implied the odds of a rate hike at the Fed’s next meeting in September fell from nearly 50 percent to around 40 percent.

Goods prices fell 0.2 percent, the second consecutive monthly decline. Excluding food and beverages, goods prices dropped 0.4 percent. Durable goods prices rose 0.3 percent after declining in May and remaining flat in June.

The goal of the Federal Reserve is to keep inflation at 2 percent; however, their policies seem to reflect politics more than inflation strategy.

Artificial Intelligence (AI) notes:

The last time the United States experienced an average inflation rate of around 2% was in 2021, when the annual inflation rate was approximately 4.7%, but it had been lower in previous years, specifically around 2.1% in 2018. The Federal Reserve typically aims for a long-term inflation target of 2%.

AI notes:

Overview of Federal Reserve Interest Rates (2016-2024)

The following points summarize key trends and changes in interest rates during this period.

  • Initial Rate (2016) — The federal funds rate was set at 0.25% in December 2015 and remained unchanged until December 2016.
  • Gradual Increases (2017-2018) — The Fed raised rates several times, reaching 2.50% by December 2018.
  • COVID-19 Response (2020) — In March 2020, rates were cut to near zero (0-0.25%) to support the economy during the pandemic.
  • Inflationary Pressures (2021-2022) — Rates remained low until inflation concerns prompted increases starting in March 2022.
  • Current Rate (2024) — As of 2024, the federal funds rate is approximately 5.25%, reflecting ongoing efforts to manage inflation.

During the first two years of the first Trump administration, interest rates were raised. In 2020, rates were lowered and remained low halfway through the Biden administration.

Draw your own conclusions.

How Is The Economy Doing?

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Obviously, the increase in gasoline prices because of the war in Iran is going to impact inflation, but that should be a temporary increase. Meanwhile, the Trump administration is doing a good job of keeping inflation under control.

On Wednesday, CNBC reported:

  • The consumer price index rose 2.4% in February from a year earlier, unchanged from January, according to the Bureau of Labor Statistics.
  • That’s still slightly above policymakers’ long-term inflation target, economists said.
  • War in Iran complicates the picture. The conflict has caused oil prices to soar since the U.S. and Israel attacked Iran on Feb. 28, raising prices for gasoline and other types of fuel.

The article at CNBC includes the following charts:

The article concludes:

Overall the CPI inflation also looks better on paper than in reality due to a quirk in the data from the government shutdown in the fall.

The record-long shutdown, which ran from Oct. 1 to Nov. 12, prevented federal statisticians from collecting typical inflation data in October. Without that data, the BLS assumed that no price increases had taken place during the month for most categories of goods and services.

Taking that measurement quirk into account, the CPI inflation is likely around 2.7%, about 0.3 percentage point higher than reported Wednesday, said Zandi of Moody’s.

The Latest Inflation Numbers

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When reading statistics about anything, remember that a good statistician can make numbers say anything he wants them to say. With that in mind, I think the June inflation numbers look really good.

On Tuesday, CNBC reported:

  • The consumer price index, a broad-based measure of goods and services costs, increased 0.3% on the month, putting the 12-month inflation rate at 2.7%, in line with expectations.
  • Core inflation picked up 0.2% on the month, with the annual rate moving to 2.9%, with the annual rate in line with estimates.
  • While the evidence in June was mixed on how much influence tariffs had over prices, there were signs that the duties are having an impact. Apparel and home furnishing prices rose, though vehicle prices fell.

…Excluding volatile food and energy prices, core inflation picked up 0.2% on the month, with the annual rate moving to 2.9%, with the annual rate in line with estimates. The monthly level was slightly below the outlook for a 0.3% gain.

Inflation in June 2022 was 9.1 percent, but began going down slowly after that. Somehow, though, even when the rate of inflation comes down, the price of everything does not go back to where it started.

The article concludes:

Amid the previously muted inflation ratings, Trump has been urging the Federal Reserve to lower interest rates, which it has not done since December. The president has insisted that tariffs are not aggravating inflation, and has contended that the Fed’s refusal to ease is raising the costs the U.S. has to pay on its burgeoning debt and deficit problem.

Central bankers, led by Chair Jerome Powell, have refused to budge. They insist that the U.S. economy is in a strong enough position now that the Fed can afford to wait to see the impact tariffs will have on inflation. Trump in turn has called on Powell to resign and is certain to name someone else to the job when the chair’s term expires in May 2026.

Markets expect the Fed to stay on hold when it meets at the end of July and then cut by a quarter percentage point in September.

The Federal Reserve was established in 1913 for the purpose of concentrating America’s wealth in the New York City Banks (yes, I know that wasn’t what you were told). It needs to go away. For further information, see The Creature from Jekyll Island by G. Edward Griffin.

The Numbers Tell The Story

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A few days ago, the mainstream media was melting down because the GDP for the first quarter of 2025 had dropped .3%. In decimal, that’s .003. That’s hardly a significant number. Meanwhile, some of the other first-quarter statistics are coming in, and they tell a rather different story.

On May 2, Breitbart reported:

Employers in the United States added 177,000 workers to their payrolls in April, the Department of Labor said Friday, and the unemployment rate was unchanged at 4.2 percent, defying predictions of labor market sluggishness following President Trump’s announcement of tariffs.

Economists had been expecting 130,000 jobs and an unemployment rate unchanged at 4.2 percent. The prior month’s jobs figure was revised down to 185,000 from 228,000

The strength in hiring came from the private sector, which added 167,000 jobs. Economists had expected private employers to add just 125,000 workers. This was nearly unchanged from the downwardly revised 170,000 jobs added in March.

The labor market drew in more workers, growing the supply of labor in April. The participation rate rose to 62.6 percent from 62.5 in the previous month. The number of people employed in the month rose by 436,000 to 163,944,000.

The average workweek expanded to 34.3 hours from 34.2 hours, a sign that employer demand for labor grew in the month. Average hourly earnings rose 0.3 percent. Compared with a year ago, average earnings are up 3.8 percent, significantly higher than the 2.4 percent gain in the consumer price index through March.

The rising wages combined with the falling inflation rate are good news for Americans. Most of us are seeing very nice changes at the gas pump. The job growth is in the private sector. Since President Trump took office, federal payrolls have contracted by 26,000. When the private sector grows, the economy grows.

According to the Government Executive Website:

President Biden has overseen a nearly 6% growth of the full-time, non-seasonal federal workforce during his four years in office, including a jump at nearly every major agency.

Most American consumers are very happy with the changes President Trump has made during his first 110 days.

The Latest Inflation Numbers

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On Thursday, The Epoch Times posted an article about the latest inflation numbers.

The article reports:

Falling energy prices helped U.S. inflation cool in March, slowing to its lowest level in six months.

According to the Bureau of Labor Statistics, the annual inflation rate declined to 2.4 percent from 2.8 percent in February, the lowest reading since September.

Economists had penciled in a reading of 2.6 percent.

On a monthly basis, the consumer price index (CPI) fell by a better-than-expected 0.1 percent.

Core inflation, which excludes volatile energy and food prices, also eased to 2.8 percent. This is the first time that annual core inflation has been below 3 percent since early 2021.

The core CPI increased by 0.1 percent month over month, below the consensus forecast of 0.3 percent.

The article concludes:

Minutes from the March Federal Open Market Committee policy meeting revealed that policymakers are worried about tariff-driven inflation risks.

“Participants assessed that uncertainty around the economic outlook had increased, with almost all participants viewing risks to inflation as tilted to the upside and risks to employment as tilted to the downside,” the meeting summary, released on April 9, reads.

However, based on President Donald Trump’s recent decision to impose a 90-day pause on reciprocal tariffs, many doom-and-gloom projections “can be dialed down a bit,” according to Mark Hamrick, senior economic analyst at Bankrate.

“The so-called 90-day pause doesn’t remove all uncertainty or potential negative impacts but is helpful,” Hamrick said in a statement to The Epoch Times.

“Fears about a huge pickup in inflation and near-term recession risks can be dialed down a bit.”

The next major inflation report will be the March producer price index, which measures the prices businesses pay for goods and services. Economists pay attention to this gauge as it can serve as a precursor to future inflation trends.

Energy prices are one of the things that fuel inflation. As American becomes energy independent again, the cost of crude oil will continue to drop, gasoline prices will continue to drop, and inflation will gradually come down. Even if OPEC cuts production in an attempt to keep oil prices high, it is quite possible that America will be able to make up for the cut. At that point, OPEC may not want to continue losing revenue because of their production cuts. We are in a very interesting time economically right now. Stay out of debt and pay your bills on time!

Every Little Bit Helps

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On Wednesday, CNBC reported that the inflation rate went down in February.

The article reports:

  • The consumer price index for both all-items and core increased 0.2% in February, slightly below expectations.
  • On an annual basis, headline inflation was at 2.8%, while core was at 3.1%. Both also were 0.1 percentage point below the Wall Street consensus and the previous month’s levels.
  • The report provided some relief as consumers and businesses worry about the looming impact tariffs might have on inflation

The article concludes:

“The February CPI (Consumer Price Index) release showed further signs of progress on underlying inflation, with the pace of price increases moderating after January’s strong release,” said Kay Haigh, global co-head of fixed income and liquidity solutions at Goldman Sachs Asset Management. “While the Fed is still likely to remain on hold at this month’s meeting, the combination of easing inflationary pressures and rising downside risks to growth suggest that the Fed is moving closer to continuing its easing cycle.”

The Fed meets next week and is widely expected to hold its key borrowing rate in a target range between 4.25%-4.5%.

Economic growth is trending negative in the first quarter, according to the Atlanta Fed’s GDPNow tracker of incoming data. The measure has pegged Q1 growth at a 2.4% decline, which would be the first negative growth quarter in three years.

I would like to remind everyone that even though President Trump has been ‘flooding the zone,’ we are only less than two months into the Trump presidency. Gas prices are going down and egg prices are going down. Both of those are good things. As far other economic new is concerned, I don’t necessarily believe the initial figures when they come out. Remember the revisions on job creation during the Biden administration. The people who told those lies may still be working for their government, and I suspect their goal is not to make President Trump look good.

The Federal Reserve has not been America’s friend for a long time. It didn’t even start out that way. If you read The Creature From Jekyll Island by G. Edward Griffin, you will find out that the true purpose of the Federal Reserve was to concentrate America’s wealth among the New York City banks. They should lower interest rates slightly, but I doubt they will.

Unfortunately, The Jobs Report Tells The Story

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The Biden administration has spent a lot of time trying to convince Americans that Bidenomics is working. Most Americans are not convinced because all of us buy groceries and gasoline on a regular basis. Now that the jobs numbers for April have been released, the true condition of the American economy is becoming obvious.

On Friday, Townhall reported the following:

The U.S. economy added 175,000 jobs in April according to the latest employment situation report from the Bureau of Labor Statistics released Friday morning, the smallest job gain in some six months and significantly below Wall Street estimates for the month.

It was expected that April would bring 240,000 to 250,000 new jobs, and the unemployment rate would remain at 3.8 percent. Instead, April was a big miss, and unemployment ticked up to 3.9 percent.

The article continued:

The labor force participation rate remained at 62.7 percent in April and the average workweek slipped down to 34.3 hours while average hourly wages rose 0.2 percent for a 12-month increase of 3.9 percent.

Comparing wage growth with inflation, the Consumer Price Index (CPI) showed core inflation was still running at an annualized 3.8 percent in March, meaning Americans’ wages are barely keeping up with still-rising costs.

The hourly wage numbers are a tribute to creative math. If the number of hours worked is decreased, but the income remains the same, it appears to be an increase on paper. It is not an actual increase. If I work 15 hours and make a total of $150, I earn $10 an hour. If I work 10 hours and make $150, I am making $15 an hour. My income has not increased, but my hourly wage has. So scaling down the average workweek increase the average hourly wage.

The article concludes:

“Today’s jobs report confirms the economy is reentering stagflation,” said Alfredo Ortiz, CEO of Job Creators Network, of Friday’s report. “Only 175,000 jobs were created last month, well below the recent average and expectations,” he emphasized. “More than half of new jobs were created in the unproductive government and quasi-government healthcare and social services sectors that don’t provide growth,” explained Ortiz. “Combined with slow economic growth and resurgent inflation, these jobs numbers suggest stagflation has returned.”

Welcome to the results of Bidenomics.

The Real Cost Of Living

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Washington always finds a way to lie with statistics when it comes to the economy. Limiting the items included in the Consumer Price Index (CPI) is one way to convince Americans that inflation isn’t as bad as it seems and also a way to limit the Cost of Living Adjustment (COLA) of various federal disbursements. However, those fake numbers don’t help Americans deal with the rising cost of food and gasoline.

On Sunday, PJ Media posted an article about the rising cost of living in America.

The article reports:

Perhaps the most misleading government statistic of all is the Consumer Price Index. The CPI is an incredibly important statistic because so many government programs that benefit American citizens are tied to that number.

It’s usually cited as the inflation rate, but it’s not really. The CPI is the rate of increase in a subjective “market basket” of goods and services. The things that concern you and me the most as far as price increases have very little to do with the CPI. The CPI doesn’t track food or gas prices at the pump, so the CPI that we see every month doesn’t tell us anything useful.

Right now, the CPI stands at 3.1%. That’s down from a high of 9.1% in June 2022. But even that doesn’t tell us the whole inflation story because along with skyrocketing food and gas prices, real wages failed to keep pace with the price increases.

According to The New York Sun:

The Bureau of Labor Statistics released jobs numbers this morning that show non-farm wages increased 4.1 percent in the past year, which is above the inflation rate of 3.1 percent. The problem is that inflation-adjusted real hourly wages — those of the average blue-collar or middle-class person — are down 4.7 percent today from when Mr. Biden took office. That’s a weekly earnings decline in real wages to $381 in November 2023 from $399 in January 2021, according to the Bureau of Labor Statistics.

“The reason Biden polls so badly is that there’s a decline in wages and an increase in prices,” a former economic adviser to President Trump, Larry Kudlow, tells the Sun. He calls this the “affordability crisis.”

Americans feel it when they walk into the grocery store. Food prices increased nearly 6 percent in 2023, according to the Department of Agriculture. In 2022, at-home food prices — what one buys in a grocery store — increased more than 11 percent. No matter one’s income, it’s hard not to notice the rising cost of food at the grocery store and at restaurants — even fast food.

Are voters going to believe what they are told or what they see?

How Is Bidenomics Working For You?

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On Thursday, The Daily Caller posted an article about the current state of the American economy.

The article reports:

Inflation rose in July after steadily declining from a high of 9.1% in June 2022, according to the latest Bureau of Labor Statistics (BLS) release on Thursday.

The Consumer Price Index (CPI), a broad measure of the prices of everyday goods like energy and food, increased 3.2% on an annual basis in July, compared to 3.0% in June, according to the BLS. Core CPI, which excludes the volatile categories of energy and food, remained high, rising 4.7% year-over-year in July, compared to 4.8% in June.

“Inflation has become much more ingrained in the economy than the White House, Congress, or the Fed want to admit,” E.J. Antoni, a research fellow at the Heritage Foundation’s Grover M. Hermann Center for the Federal Budget, told the Daily Caller News Foundation. “Combined with slowing economic growth, we have the perfect recipe for stagflation.”

The workforce participation rate has remained at 62.6 since March. In February 2020, before Covid, it was 63.3. It began a downward spiral in March 2020 and has never fully recovered. The economy has not grown significantly–jobs added are simply the jobs coming back after the Covid pandemic.

The article concludes:

The U.S. added 187,000 jobs for the month of July, 13,000 fewer than economists expected, and the unemployment rate fell to 3.5%. The number of jobs for the months of June and May was revised down by a cumulative 49,000 jobs.

The U.S. economy grew at a rate of 2.4% in the second quarter of 2023, surprising economists who anticipated a more modest expansion of 2%.

More Fact Checkers

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On Thursday, The Washington Examiner posted an article about President Biden’s recent speech on Bidenomics.

The article reports:

President Joe Biden promised a “fundamental break” with “trickle-down economics” in a speech on Wednesday in which he relied on a number of misleading claims to make his point.

Touting “Bidenomics,” the White House’s name for its economic agenda heading into the 2024 race, Biden floated a plan that would involve spending more taxpayer money and boosting union labor.

Here is the fact check on that speech:

“My predecessor enacted the latest iteration of the failed theory. Tax cuts for the wealthy. It wasn’t paid for, and the estimated cost of his tax cut was $2 trillion.”

Former President Donald Trump‘s tax cuts did not benefit only the wealthy, and they didn’t cost the government nearly as much as critics claimed.

Last year, the Congressional Budget Office actually said the government is expected to collect more revenue over the next decade than it had projected before the tax cuts were signed into law.

In fiscal 2018, the first year after Trump signed the tax cuts into law, the federal government actually collected slightly more revenue overall than it had the previous year.

We learned this during the Reagan administration–when you cut taxes, revenue goes up.

The article continues:

“Wind and solar are already significantly cheaper than coal and oil. You’re not going to see anybody building a new coal-fired plant in America — not just because I’d like to pass a law to say that; it’s too expensive.”

One key reason that renewable energy is now cheaper than traditional energy production is because the Biden administration has offered sweeping tax breaks and subsidies to green energy companies.

…“Today, inflation is less than half of what it was a year ago. And that inflation [was] caused by Russia and by the war in Ukraine and by what was going on.”

Inflation still remains significantly higher than before Biden took office, even if it has fallen from the heights of last year.

Before Biden took office, the consumer price index, a measure of inflation, rose 1.4% for 2020.

The CPI climbed 4.9% from April 2022 to April 2023, meaning prices this year are still rising far faster than before Biden’s inauguration.

While inflation was indeed worse last year, with prices jumping by 8.6% between May 2021 and May 2022, it remains a significant problem for many at nearly four times the level it was before Biden’s presidency.

…“When I took office, unemployment was over 6%. With the American Rescue Plan, we provided relief and support directly to working-class families. Our economy came roaring back. Unemployment dipped below 4% by the end of my first year in office.”

Like Biden’s claim about the number of jobs created, this statement is misleading because the unemployment rate was artificially high when he took office.

The unemployment rate had already begun to come down from its high of 14.8% in April 2020 by the time Biden took office.

Ending lockdowns and easing pandemic restrictions were the primary drivers of the unemployment rate’s fall, but Biden opposed both as a presidential candidate.

…“Just in my first two years in office, my team and I reduced the deficit by $1.7 trillion.” 

Biden has previously touted the deficit reduction that occurred on his watch, and it’s been misleading every time.

The national debt grew by $7.8 trillion during Trump’s four years in office.

But much of that occurred in 2020 as a result of emergency pandemic spending.

The deficit at the end of fiscal 2020 was more than triple what it was at the end of fiscal 2019, a result of the massive rescue packages Congress passed to blunt the effects of lockdowns.

…In fact, Biden has pushed for record levels of spending, and he asked Congress for relief funds in 2021 well in excess of what was needed at the time.

Please follow the link to the article for further details.