Inflation went up again in April, Fed soft landing may be bumpy
Everyone hoped April’s Consumer Price Index would show inflation had peaked, signaling the Federal Reserve’s ‘soft landing’ approach of raising interest rates to tackle the rising costs of — well, everything — was working, and so far it’s hard to say.
“The Consumer Price Index for All Urban Consumers increased 0.3% in April on a seasonally adjusted basis after rising 1.2% in March,” the U.S. Bureau of Labor Statistics reported today. “Over the last 12 months, the all items index increased 8.3% before seasonal adjustment.”
The month before, it was 8.5% for the year. That’s a reduction year to year, but still an increase in inflation following March’s 1.2% increase.
In the run of things, though, that’s actually an eight-month low on monthto-month increases. Some areas have been hit harder than others.
“Increases in the indexes for shelter, food, airline fares and new vehicles were the largest contributors to the seasonally adjusted all items increase,” BLS reported.
President Joe Biden was quick to respond with a press release, acknowledging and downplaying the rise in inflation in the same sentence.
“While it is heartening to see that annual inflation moderated in April, the fact remains that inflation is unacceptably high. As I said yesterday, inflation is a challenge for families across the country, and bringing it down is my top economic priority,” he said.
Biden said the central bank has the power to bring inflation down.
“This starts with the Federal Reserve, which plays a primary role in fighting inflation in our country,” he said.
The Consumer Price Index indicated inflation is approaching a 40-year high.
The Fed has raised interest rates twice in response to inflation, the second the largest in 22 years, saying the aim is to push it back toward 2%.
Continued inflation rise will require a round of six more quarter-point raises to its key rate to bring things under control, the central bank indicated last week.