Consumer prices increased 7% in the 12 months ending in November, the fastest clip since 1982, solidifying inflation as the greatest threat to President Joe Biden’s agenda.
The much-anticipated numbers reported by the Bureau of Labor Statistics Wednesday revealed the extent of the inflation that has afflicted the country as it recovers from the COVID-19 pandemic.
High inflation has damaged Biden’s popularity and sapped support for his plans for new major spending programs and tax hikes.
“This crushing report shows Democrats’ spending has pushed Bidenflation to achieve the highest prices in 40 years, killing family budgets and wiping out three years of wage gains,” said Rep. Kevin Brady of Texas, the top Republican on the Ways and Means Committee.
The persistent inflation has led the Federal Reserve to gear up to raise interest rates this year for the first time since 2018. This year could see several interest rate hikes, the first of which might occur in March.
POWELL PLEDGES TO BRING DOWN INFLATION DURING CONFIRMATION HEARING
Federal Reserve Chairman Jerome Powell testified before the Senate on Tuesday and told lawmakers that the economy is now in good enough shape for pandemic-related stimulus to be pared back and for interest rates to be raised. This comes after months of unprecedented economic support by the Fed.
“When the annual rate of inflation begins with a 7, there is immense pressure on the Federal Reserve to get it under control, supply chain issues notwithstanding,” said Bankrate’s chief financial analyst, Greg McBride.
The new inflation numbers come on the heels of a worse-than-expected December jobs report last week. The economy added just 199,000 new jobs in November, below forecasts, although the unemployment rate dipped below 4% for the first time since the pandemic began.
CLICK HERE TO READ MORE FROM THE WASHINGTON EXAMINER
The combination of high inflation and weaker-than-anticipated job creation has some economists worried about the country’s long-term recovery from the COVID-19 pandemic.
Another factor causing uncertainty in the economy is the omicron variant of the virus, which has completely overtaken the country and sent cases, hospitalizations, and deaths soaring to record highs.
