As the Biden administration prepares to celebrate history on the South Lawn, inside the White House the biggest news of the day is already reverberating. The Consumer Price Index data provided the latest evidence is inflation is cooling, with clear positive signs on both a year over year and month over month basis.
President Joe Biden during a White House speech Tuesday morning called the latest data “welcome news,” expressing cautious optimism that the administration’s most significant economic problem is starting to show tangible signs of easing.
The numbers, Biden said, provide “reason for some optimism for the holiday season and, I would argue, the year ahead.” Still, the president conceded that prices “are still too high” and suggested it will “still take time” to get levels back to normal.
But Biden pointed to lower gas and food prices as a signal that the economy is “headed in the right direction.”
Biden acknowledged that it will “take time to get inflation back to normal levels” as he warned there could be “setbacks along the way.” And the president later told reporters he hopes prices will stabilize “by the end of next year,” but warned, “I can’t make that prediction.” However, he still asserted that he is “convinced [prices are] not going to go up” any further.
White House officials acknowledge there is still a long road ahead – and inflation still remains historically quite high. But the new data follows a string of positive economic news and comes the same day the Federal Reserve is expected to trigger more rate hikes, marking a strong data-point that sweeping price increases are starting to decelerate on a concrete basis.
Especially encouraging for White House officials: the November CPI report released on Tuesday marked the fifth consecutive month of declining US inflation.
This comes as officials in recent weeks have been encouraged by several areas where they see prices moderating, including gas, car and airline prices. While no White House official will publicly say that they believe inflation has peaked, taken together with other signs of economic progress, including continued strength in the labor market and strong GDP growth, the White House believes there is reason for the current mood of cautious optimism to hold.
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