On the heels of this week's mess of a first quarter GDP report that showed the economy's growth slowing more than expected to just +1.6 percent and costs surging more than expected, another inflation report released Friday showed hotter-than-expected price increases in March.
Known as the Federal Reserve's "preferred" gauge for inflation, the personal consumer expenditures (PCE) price index increased 0.3 percent in March for an annual advance of 2.7 percent, more than economists expected. Core PCE inflation — excluding food and energy — rose the same 0.3 percent in March for a 12-month increase of 2.8 percent.
Notably, both annualized core and headline PCE numbers remain above the Fed's target of just 2.0 percent inflation.
PCE and core PCE price indexes shot up 0.3% in Mar - remember when they said inflation was slowing down? Here's your "slowing down"... pic.twitter.com/zvZD7MN8Kc
— E.J. Antoni, Ph.D. (@RealEJAntoni) April 26, 2024
The higher-than-anticipated inflation in March came from monthly increases in services (+0.4 percent), goods (+0.1 percent), and energy (+1.2 percent). Since this time last year, services are 4.0 percent more expensive, food costs increased 1.5 percent, and energy bills are 2.6 percent higher, according to the U.S. Bureau of Economic Analysis (BEA).
The bad economic news is no surprise, given the previous three-plus years of President Joe Biden's "build back better"-turned-"Bidenomics" policies put the U.S. into a tailspin putting the highest inflation in 40 years together with the highest interest rates since early 2001 and looming tax hikes to pay for the president's spending binge.
House Ways and Means Committee Chairman Jason Smith (R-MO) noted Friday that Biden's "recipe of outlandish spending and higher taxes is robbing the American people and hurting the economy."
"The soaring cost of gas and groceries keeps killing family budgets — leaving Americans struggling to either pay rent or buy a house," Smith emphasized in a statement provided to Townhall. "With prices continuing to rise and the Federal Reserve likely to keep interest rates at the highest levels in over 20 years, the American Dream is slipping out of reach for more families."
Smith urged his fellow lawmakers to "build on the success of the Trump tax cuts" by "passing the Tax Relief for American Families and Workers Act to secure immediate relief" while preparing to "fight back against President Biden's proposed $7 trillion tax hike," another policy that "would only further damage the economy and harm working families."
Alfredo Ortiz, CEO of Job Creators Network, told Townhall that blame for still-rising inflation belongs with the "Democrats' unwillingness to accept sensible government spending measures."
"Reckless" spending by Democrats is "fueling inflation's fire and devaluing the dollar," Ortiz explained. "As a result, the Federal Reserve can't go ahead with planned interest rate cuts needed by small businesses to end the credit crunch. Combined with Thursday's GDP report, these inflation numbers show the economy is reentering stagflation," he warned.
"The only way to grow the economy and tame inflation for good is for voters to replace spendthrift Democrats with sensible conservatives on Election Day," Ortiz admonished.