New CPI Numbers Reveal Bumpy Road Ahead for Getting Inflation Back to Normal

WASHINGTON - If you think prices are still high, you're right. The latest government numbers show inflation is still climbing, although not as fast as the last few years. 

While efforts by the Federal Reserve have slowed inflation, board members aren't ready to declare victory. Partly because the latest Labor Department numbers prove getting inflation back to normal might be more difficult than expected.

"We've been very clear here that prices are still too high. We're going to do everything we can to lower the costs," declared White House Press Secretary Karine Jean-Pierre on Tuesday.  

New data shows the Consumer Price Index (CPI) rose 3.1% over the last 12 months. It was a higher jump than anticipated, which likely means no cuts in high-interest rates as the Fed hopes to bring inflation down to a 2% target before taking action.

***Please sign up for CBN Newsletters and download the CBN News app to ensure you keep receiving the latest news.***

"We're making real progress," President Biden said while talking about the economy this week.

On the campaign trail, Biden is highlighting his economic policies and hailing signs of economic strength.

"Consumer sentiment surged 29% in the last two months, the biggest jump in 30 years," Biden said. "Americans have filed a record 16 million new business applications since I came to office. And every one of those applications is a sign of hope. We're just getting started, folks."

Joel Griffith, a Research Fellow at The Heritage Foundation, however, warns those rosy numbers are misleading.

"How is it that consumers continue to spend more driving economic growth even though they're earning less in real terms?" asked Griffith. "Well, that's because consumers on average have added $4,000 per family to their credit card balances, and families have drained close to 80% of their savings."

Griffith told CBN News American families are well aware their financial situations have deteriorated in recent years. 

"And these inflation numbers don't even fully account for the fact that homeownership has been driven out of reach. Those numbers estimate what it costs to rent,"  Griffith explained. "If you're looking to buy a home, the numbers are even worse."

And he blames policies from both the Biden and Trump administrations.

"Something to keep in mind with President Trump. We need to remember that the match was struck for this inflationary boom during the Trump administration," said Griffith. "A bipartisan Congress pushed forward massive spending, the biggest spending increases we've seen really, since World War 2, and President Trump signed that into law and actually approved it," Griffith said. 

"So look, the economy right now, for most families, it is rough. President Biden has made it worse by continuing these enormous spending levels," he noted. 

Griffith believes all 2024 candidates should firmly commit to getting government spending in order or warns we will see heightened inflation for years to come.