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Biden administration signals Friday’s inflation data could be high

US President Joe Biden delivers remarks on infrastructure at the Kansas City District Transportation Authority in Kansas City, Missouri, US, December 8, 2021. REUTERS/Jonathan Ernst

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WASHINGTON (Reuters) – President Joe Biden, preparing to raise inflation again, sought to reassure Americans on Thursday that increases in the costs of energy and other major commodities were beginning to ease, but said the change might not be reflected in November’s data. Friday.

A Reuters poll of economists showed that the consumer price index for November is expected to rise 6.8% from the same month last year, outpacing an increase of 6.2% in October, which was the fastest gain in 31 years. Read more

Biden said in an unusually long statement released ahead of Friday’s statements.

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Republicans have seized the issue to criticize Biden’s sweeping spending agenda, and it has affected the president’s approval ratings in recent months.

These claims have not been fully supported, given that inflation is global, and annual inflation rates for many of the goods American households routinely buy — including food — were already at their highest levels in a decade before Biden entered the White House early this year.

He reiterated that passing the $1.75 trillion “Build Back Better” social spending plan would help cut costs.

Biden’s chief economic adviser, Brian Daisy, appeared at the regular White House press conference to deliver the same message.

He spoke of a drop in unemployment figures to 1969 levels, a rise in real family income and what he called “encouraging signs” in labor force participation, while warning against over-interpreting Friday’s data.

“This data is by definition lagging, so it’s not going to capture some of the recent price movements, particularly in the energy areas,” Dess said, referring to a nine cent decline in gasoline prices nationwide.

Dess said 20 US states have had gasoline prices below the 20-year average, and more states should join their ranks in the coming weeks. He said a “very significant drop” in natural gas prices would also help ahead of the winter heating season.

Deese also cited lower shipping costs and some commodities, including wheat and pork, as well as lower wholesale used car prices that would drive consumer prices lower.

A Reuters poll showed that the core CPI for November, which strips out volatile food and energy components, is expected to have accelerated to a 4.9% annual increase from the previous month’s 4.6% gain.

Federal Reserve Chairman Jerome Powell said last week that the US central bank needs to be prepared to respond to the possibility that inflation does not abate in the second half of next year as most forecasters currently expect. Read more

Dess declined to predict whether the price hike will continue into the next year, but said that most independent forecasters expected inflation to decline “significantly” over the course of 2022.

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(Reporting by Chris Gallagher and Nandita Bose in Washington); writing by Andrea Shalal; Editing by Alistair Bell and Dan Grebler

Our Standards: Thomson Reuters Trust Principles.

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