Kirabo Jackson Council of Economic Advisors (Photo/Northwestern University)
By Karen Stokes
The June data of 3.0 percent surpassed expectations on multiple fronts, with headline inflation experiencing a decline of 0.1% on a monthly basis—something not seen since the early days of the pandemic. On an annual basis, headline inflation slowed to a 3% pace, from 3.3% in May.
The Consumer Price Index, a measurement of the average change in prices for a commonly purchased basket of goods and services, dropped 0.1% from May, which helped to slow the annual rate of inflation to 3% from 3.3% in May, according to the Bureau of Labor Statistics’ latest report.
“The 3% number came in a little bit below what forecasters had expected, which is good news,” said Kirabo Jackson, Council of Economic Advisors. “We’re moving in the right direction in this steady growth that is consistent in terms of the number of jobs added. We had 206,000 jobs last month and inflation that continues to ease.”
A statement from President Biden said, “Today’s report shows that we are making significant progress fighting inflation. Overall prices fell last month, after staying flat in May, and core inflation is the lowest in more than three years. Prices are falling for cars, appliances, and airfares, and grocery prices have fallen since the beginning of the year. Thanks to my economic plan, wages are rising faster than prices, we’ve created 15.7 million jobs, and communities that were left behind by my predecessor are making “a remarkable comeback.”
“The reason we have a very stable economy right now is due to a lot of policies that President Biden has put in place already. One thing I want to highlight was when President Biden came into office one of the first things he did was to tackle a supply chain issue so a lot of the inflation that we saw in 2022 was driven by the fact that we had supply chain disruptions. We were in the middle of a pandemic as well as a war in Ukraine which led to a spike in prices. One way is to maintain the stability of prices to make sure we maintain the stability of supply chains,” Jackson said.
He continued, “We had our inflation under control without any increase in unemployment so a lot of people looked at the economy 18 months ago and said there was no way we were going come down from the high levels of inflation that we saw in the summer of 2022 without putting the country in a deep recession and we did exactly that.”
Additionally, the IRS announced that a new initiative to collect past-due tax debt from high-income, high-wealth individuals has reached a major milestone, with more than $1 billion recovered. This new initiative was made possible by resources from President Biden’s Inflation Reduction Act and displays his commitment to ensuring the wealthy pay their fair share.
“When we’re able to collect more in taxes, by making our tax system more efficient we have a way to fund all the important objectives that we have. We fund childcare, we fund education, we fund medical care and keep prices down, and invest in clean infrastructure,” Jackson said.
In addition to enhancing tax fairness, these initiatives will narrow the gap between taxes owed and taxes paid, reducing the deficit.