The White House wallowed in a bit of good news last week when the Labor Department revealed that inflation in June had cooled to its lowest pace — 3% — in more than two years. Still, Fed officials have signaled that another rate hike is coming because they don’t want to overreact to a single month’s improvement.
President Joe Biden took the news as a validation of his economic policies, which is like the arsonist offering a bow after the massive blaze he started has been 50% contained. Despite recent progress, inflation remains higher than the Fed target rate of 2% and more than double what it was when Biden entered the White House. Administration officials would prefer not to talk about how the rate ever climbed beyond 9% in the first place, the highest in four decades.
“Prices are going up at a slower rate overall, the good news is that things are not getting worse for American consumers,” Leo Feler, chief economist at the research firm Numerator, told The Wall Street Journal. “But that doesn’t mean they’re necessarily getting all that better.”
