After a terrible half-year marked by skyrocketing inflation and plummeting consumer confidence, the Biden administration is beginning to see economic signals of hope.
It may have reached its peak now. More than two months have passed since gas prices dropped. The job market is still very strong, and unemployment is very low. Now, news stories are frequently dominated by topics other than historic price increases and President Joe Biden’s abysmal poll results.
None of these patterns are certain to last. Prices are still very expensive. Oil prices may increase once more as a result of Russia’s war in Ukraine. Additionally, Federal Reserve Chair Jerome Powell vowed on Friday that the central bank would take whatever measures were necessary to combat high inflation, setting off a stock market meltdown and escalating concerns that the Fed might raise interest rates too quickly and send the economy into recession.
But for now, the trend is our friend, as one top Biden adviser put it, and it looks much better than it did a few months ago, with the government reporting that the Fed’s favoured measure of inflation decelerated in July.
Jan Hatzius, chief economist at Goldman Sachs, stated that “we had a considerably better inflation number on Friday, and reduced gas costs suggest we will probably see even more improvement in consumer confidence.” “I have a cautious optimism about the direction of inflation.”