Biden, who has been heavily criticized for surging inflation since his election, had good news to share with Americans on Wednesday regarding the economy. A recent report from the U.S. Department of Labor showed that inflation may be heading in the right direction as the producer price index dropped by .5 percent from November to December.
The news is a sigh of relief for Americans who have battled high gas and grocery prices for the past few years. The producer price index can signal the future of consumer inflation.
“Today, we received more evidence that we are making real progress tackling inflation and lowering costs, successfully transitioning from a historic recovery to steady and stable growth. The inflation rate for producers fell further, and is now at its lowest level since March 2021,” Biden said in a statement.
The drop in the producer price index is the highest since April 2020, shortly after the COVID-19 pandemic started, Bloomberg reported.
The decrease was largely reflected in lowered food and energy prices, with grocery costs decreasing by 1.2 percent and a steep decrease of more than 13 percent in gas prices over November. Price increases outside of the food and energy sectors began to slow and rose by .1 percent in December. Those levels were the lowest they’ve been in nearly two years, according to Biden’s statement.
One financial expert tweeted that the data signals the Federal Reserve may slow its interest rate hikes.
“Fed now expected to hike only 25 bps @ Feb 1 meeting,” Creative Planning Chief Market Strategist Charlie Bilello wrote.
Over the course of the last year, the Federal Reserve has raised rates repeatedly, skyrocketing rates from .25 percent in March 2022 to 4.25 percent in December. If the Fed raises rates by .25 percent at its next meeting, it will be the lowest increase since March 2022.
The Associated Press reported that the drop in wholesale price growth was mostly reflected by gas prices and food prices, specifically fruits, vegetables and chicken.
Biden also noted that Americans continue to spend money despite inflation, although the pace at which they are spending is slowing.
“That’s expected with the transition to steady and stable growth,” he said.
Biden touted other recent wins the government experienced, such as a 50-year low unemployment rate, inflation decreasing for six consecutive months and “record-setting small business applications” during his first two years in office.
It comes after news broke earlier this month that classified documents from Biden’s time as vice president were discovered in November at his former office at the Penn Biden Center. Further materials were found at his home in Wilmington, Delaware, as well. Many slammed Biden, as he had criticized former President Donald Trump for keeping classified documents at his Mar-a-Lago home in Florida, which was raided by the FBI in August.
