Consumer prices continued their steady rise upward in July, with inflation running at 5.4% annually, well above the Federal Reserve target of 3%, according to data released by the Labor Department.
The index for all items less food and energy, called the core index, increased 0.3 percent in July on a seasonally adjusted basis, or 3.6% annually.
Economists predicted a 0.4% increase in the core index, according to CNBC.
JUST IN: Inflation was a whopping 5.4% in July (over last year). That’s the same as in June and the highest in 13 years.
Yes, some of this is short-lived problems. Used car prices are up ~42%(!), but note that shelter costs and restaurant prices are also moving up. pic.twitter.com/77BDSDGZxl
— Heather Long (@byHeatherLong) August 11, 2021
The CPI measures goods and services consumers use in everyday life.
While the data tends to show that inflation may be slowing, it doesn’t mean that economy is clear from inflation worries.
Inflation is still well above the target rate sustainable by the economy, especially for workers trying to recover from the pandemic shutdowns.
Inflation eats into the paychecks of ordinary workers, who then demand wage increases, which must be passed along to consumers, further fueling rising prices.
Republicans immediately criticized the Democrats for the inflationary pressures.
The GOP is a counting on public dissatisfaction with inflation, amongst other issues, to help at the polls.
“Everything is more expensive in Democrats’ America. Speaker Pelosi and House Democrats should abandon their push to spend trillions more on a socialist agenda,” said National Republican Congressional Committee spokesman Mike Berg.
Republicans have charged that Democrat spending, including the $1.9 trillion in pork barrel items approved in the spring, has contributed to inflation by pushing vast amounts of money through the economy without much benefit.
“This administration has mismanaged the economy, mismanaged the border, mismanaged crime in the cities, and people are noticing and are very disturbed by it. Take a look at any of the poll numbers,” Sen. John Barrasso (R-Wyo.), chairman of the Senate Republican Conference, told Axios.
Consumer prices jumped more than 10% in the previous month in part because of soaring auto prices and wage increases.
