The US consumer price index is expected to have risen at only a slightly slower pace last month, cementing criticism that the Biden administration has failed to meaningfully bring down inflation before the November midterm elections.
According to economists polled by Reuters, CPI is forecast to have increased by 8.1 per cent in September compared to the same month last year, just below the 8.3 per cent annual rise recorded in August.
The core CPI measure, which strips out volatile energy and food costs, is forecast to have risen by 6.5 per cent last month, faster than the 6.3 per cent rate in August, a sign that underlying inflationary pressures were still accelerating.
The persistence of high inflation has been a huge political headache for the White House and congressional Democrats, overshadowing a swift recovery out of the coronavirus pandemic with millions of jobs created since Joe Biden took office.
Senior White House economic officials initially expected the jump in inflation to be shortlived, then scrambled to find ways to ease supply chain disruptions and reduce petrol prices, as the Federal Reserve began to tighten monetary policy.
Amid intensifying political pressure, Biden eventually struck a deal with Congress to enact a legislative package called the Inflation Reduction Act, which included measures to reduce the cost of some goods such as prescription drugs, but had little effect on prices in the short term.
Meanwhile, Republicans have made rising prices a central part of their message to voters, blaming the Biden administration for the higher costs, and tying the rise in prices to the Democrat-led stimulus enacted by the president in March 2021 that injected $1.9tn into the US economy.
On Wednesday, several Republican lawmakers and candidates jumped on new figures showing that the producer price index, a measure of wholesale prices for businesses, rose faster than expected in September.
Rick Scott, the Republican senator from Florida who chairs the National Republican Senatorial Committee, said inflation was an “unbearable kick for families trying to get back on their feet” in his home state in the wake of Hurricane Ian.
Mike Crapo, the most senior Republican on the Senate finance committee, said: “American families and businesses continue to be hammered by the runaway inflation generated from reckless spending policies of the Biden administration.”
He added: “The current administration took an economy on an impressive rebound from lockdowns, injected trillions of dollars in reckless spending, and American families and future generations will pay the price of economic mismanagement.”
US consumers have received some relief from the fall in petrol prices that occurred over the summer: the peak of inflation under Biden so far came in June, when CPI rose by 9.1 per cent on an annual basis. But the administration and Fed officials would have liked to have seen the price increases fade more rapidly than they have.
