It has now been 300 days since President Joe Biden said high inflation would be “temporary” as the cost of consumer goods, including gas, has continued to rise.
On July 19, 2021, Biden addressed inflation in comments at the White House, arguing that the significant price increases that had taken place during the reopening of the economy would not last.
“We also know that as our economy picks up again, we’ve seen some price increases,” the president said.
“Some people have expressed concern that this could be a sign of continued inflation. But that is not our view. Our experts believe and the data shows that most of the price increases we have seen – were expected and expected to be temporary would be.” he said.
“The reality is you can’t click on the global economic light again and expect it to happen,” Biden said, adding later that “these disruptions are temporary.”
The annual inflation rate in June and July 2021 was 5.4 percent as the economy emerged from the severe constraints imposed by the COVID-19 pandemic.
June inflation marked the highest price hike in 13 years and it was speculated at the time that inflation had peaked.
However, 300 days after Biden’s comments, prices continue to rise and annual inflation is even higher than last summer. In April, inflation stood at a near-record high of 8.3 percent — levels not seen in 40 years.
The average price of a gallon of gasoline also hit a new record this week, costing more than $4.45 a gallon on Friday, according to the American Automobile Association (AAA).
Inflation stood at 8.5 percent in March and represented the largest price increase in a year since December 1981.
Last July, Biden said he had told Federal Reserve chairman Jerome Powell that the Fed is independent and must “take whatever steps it deems necessary to support a strong, sustainable economic recovery.”
On May 4, the Fed announced a half-point rate hike and is expected to make two more half-point hikes in June and July. The central bank’s inflation target is 2% year on year.
Powell told Marketplace in an interview on Thursday that reaching that goal could involve “pain.”
“The process of bringing inflation down to 2 percent will also be painful, but in the end the most painful thing would be if we failed to tackle it and inflation anchored in the economy at a high level.” said the Fed. chairman said.
“What we can control is the demand, we can’t really influence the supply with our policies,” said Powell, explaining that supply was a big problem and that global events also played a role.
“So whether we can perform a soft landing or not may actually depend on factors beyond our control,” he said.
news week asked the White House for comment.