U.S. consumer prices in November rose at the fastest pace in nearly 40 years, putting political pressure on the Joe Biden administration.
According to the Bureau of Labor Statistics, the Consumer Price Index rose 0.8% in November, an increase of 6.8% over the past 12 months, the fastest annual rate since 1982 (7.2%)
Bloomberg writes that the biggest contributors to overall inflation were increases in gasoline, housing, food and automobile prices.
According to economists, inflation is breaking records, in part because of the pandemic – it has become more difficult to produce and deliver products. In addition, the government supported the population, so households spent more.
Also, wages have risen substantially in recent months, but the rate of wage growth has so far lagged behind inflation.
As noted by the Financial Times, inflation has become a political problem for the White House, putting pressure on the ratings of President Biden, as well as the electoral prospects of his Democratic Party before the midterm elections next year.
The White House took a defensive stance before Friday’s report, and Biden issued a statement seeking to downplay the relevance of the incoming data.
“The energy information does not reflect today’s reality and does not reflect price declines in the coming weeks and months, such as in the auto market,” Biden said Thursday.
Gasoline prices in the U.S. have fallen in recent weeks, as have natural gas prices, with a senior administration official saying that this “relief” is not reflected in the November report.
