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U.S. inflation surged again in May, pushed higher by the effects of the war in Iran
For months, Donald Trump and White House officials had a habit of insisting that the president had delivered an economy with “no inflation.” The public has heard a lot less of such talk lately, and there’s no great mystery as to why. CNBC reported:
The consumer price index, a broad gauge of goods and services costs across the U.S. economy, rose at a seasonally adjusted 0.5% for the month, putting the annual inflation rate at 4.2%, the Bureau of Labor Statistics reported Wednesday. Both numbers were in line with the Dow Jones consensus.
Inflation climbed above 4% for the first time in three years, though the increase met expectations amid concerns over how much the surge in energy prices would impact the economy. The level was the highest since April 2023 and above the 3.8% level from April.
The figures were entirely in line with a variety of related metrics related to the rising cost of living, including the Personal Consumption Expenditures index, the core personal consumption expenditures price index and wholesale prices, all of which recently hit three-year highs.
All of that related data, incidentally, was released shortly before White House deputy chief of staff Stephen Miller told Fox News that Trump has transformed the U.S. into an “extraordinary paradise.”
As for what’s driving the discouraging data, it is — to the surprise of no one — energy costs that are pushing prices higher, which is the direct result of the war in Iran.
Perhaps most importantly, NBC News’ report emphasized that inflation’s rise “has surpassed wage growth,” which necessarily exacerbates the affordability crisis gripping American consumers.
The White House has not yet commented on the new data, although Kevin Hassett, the director of the National Economic Council and the top economist at the White House, has argued in recent weeks that rising inflation should be blamed on Democratic policies in blue states. Those claims, like much of what Hassett has to say, have been thoroughly discredited.
And no one is buying it. The latest national CNN poll found that 77% of respondents, including a majority of Republican voters, agreed that Trump’s policies have increased the cost of living. The same poll found just 30% of Americans approve of the president’s handling of the economy, a career low for the Republican across both terms. That mirrored the results of the latest national Associated Press poll.
There’s no reason to assume those results won’t continue to get even worse.
This post updates our related earlier coverage.
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