August Inflation Report Shows Several Nasty Surprises, Biden Claims Victory Anyway

The Consumer Price Index (CPI) rose 8.3% between August 2021 and August 2022, according to a Tuesday report from the Bureau of Labor Statistics.

The reading marks a decline from the 8.5% year-over-year rate seen in July and the 9.1% year-over-year rate seen in June as gasoline prices continue to fall. However, month-over-month prices for food, shelter, and medical services continued to tick upward, producing a 0.1% overall price increase from July. Economists had expected headline inflation to fall 0.1%.

“The substantial decline in gasoline prices is noteworthy but doesn’t address the overall problem with inflation,” Bankrate senior economic analyst Mark Hamrick told The Daily Wire, noting that the August report contains “unpleasant surprises aplenty.”

Prices for food at home — a category that includes grocery store or supermarket food purchases — increased 0.7% from the previous month. Meanwhile, prices for natural gas and electricity rose 3.5% and 1.5% respectively.

Indeed, core inflation — the price level increase for all items except for food and energy — saw a 0.6% increase in August, marking a faster rate of increase than July and producing a 6.3% year-over-year rate. Economists were expecting core inflation to rise 0.3%.

Regardless of the negative surprises, President Joe Biden claimed victory in the “essentially flat” prices.

“It will take more time and resolve to bring inflation down, which is why we passed the Inflation Reduction Act to lower the cost of healthcare, prescription drugs and energy,” he said in a statement. “And my economic plan is showing that, as we bring prices down, we are creating good paying jobs and bringing manufacturing back to America.”

Last month, multiple White House officials spun the July inflation report by noting that inflation was, on paper, 0%, even as they failed to mention the continually rising prices for food and other commodities — as well as the fact that inflation was 1.4% when Biden assumed office, according to data from the Bureau of Labor Statistics.

“Today we received news that our economy had 0% inflation in the month of July,” Biden told members of the press. “Here’s what that means — while the price of some things went up last month, the price of other things went down by the same amount. The result: zero inflation last month. People are still hurting, but zero inflation last month.”

As Democratic candidates across the country prepare for midterm elections in two months, the White House released a lengthy report last week detailing the Biden administration’s purported economic accomplishments. The document repeatedly gives Biden credit for the recent plateau in price levels.

“President Biden is committed to tackling these immediate challenges, without giving up the substantial economic and labor market gains our economy has achieved,” the report said. “And we are seeing significant progress on that front, with a decline of more than $1.20 in gas prices this summer and overall prices in the economy declining moderately in July.”

The document failed to note, however, that the national average price of gasoline was $2.38 per gallon when Biden assumed office and increased to $3.53 per gallon by the start of the Russian invasion. Prices surpassed $5.00 per gallon in early June before subsiding to $3.71 per gallon as of Tuesday, according to data from AAA.

Although the declining prices at the pump were largely responsible for the moderating year-over-year inflation, Treasury Secretary Janet Yellen acknowledged on Sunday that there remains a “risk” of gas prices spiking again this year.

“Well, it’s a risk. And it’s a risk that we’re working on the price cap to try to address,” she said during an interview with CNN. “This winter, the European Union will cease, for the most part, buying Russian oil. And, in addition, they will ban the provision of services that enable Russia to ship oil by tanker. And it is possible that that could cause a spike in oil prices.”