Hit to the pockets and bad news for Biden: inflation remained high in March in the United States

Bad news for Joe Biden’s government: Inflation remained high in the United States, even in March, he adds another round of price increases for already strained wallets of Americans.

The Bureau of Labor Statistics reported this Wednesday, highlighting that 12-month price growth has accelerated from 3.2% in February to 3.5% in March, coinciding with the consensus forecasts among economists.

In view of the presidential elections in November, in which Biden will seek re-election against the candidacy of Donald Trump, the increase in prices It’s a bitter pill for the Democrat.

Consumer prices rose 3.5% in March from a year ago, accelerating sharply from the previous month and reversing some progress achieved in a two-year struggle to cool inflation in the United States.

Price increases have eased sharply from a peak of around 9%, but inflation remains more than a percentage point above the Federal Reserve’s 2% target rate.

Why has inflation increased in the United States?

More than half of the monthly increase in consumer prices was due to rising gasoline and housing costs, the Bureau of Labor Statistics said.

Meanwhile, economic performance has been strong, boosting consumer demand and putting upward pressure on prices.

Core inflation, a closely monitored measure eliminates the volatility of food and energy prices, according to the data, in the year ending in March it increased by 3.8%, remaining stable compared to the previous month.

Offering relief to families, prices of some basic food items fell during the year ending in March. Over the same period, the prices of breakfast cereals, rice and pasta fell by more than one percentage point.

At a meeting last month, The Federal Reserve has chosen to keep rates very high in response to persistent inflation. The Federal Reserve funds rate remains unchanged between 5.25% and 5.5%reaching the highest level since 2001.

“On the issue of inflation, it’s too early to say whether the recent data represents anything more than a success,” Federal Reserve Chair Jerome Powell said at a business conference at Stanford University last week.

“Given the strength of the economy and the progress made so far on inflation, we have time to let incoming data guide our policy decisions“Powell added.

The Federal Reserve said last month it still plans to make three interest rate cuts this year.

As for the unemployment rate, it has remained below 4% for the longest period since the 1960s, stocks are at all-time highs, and the economy continues to add jobs.