After more than two years of being politically battered over soaring prices, Wednesday’s inflation report left many Democrats feeling victorious.
Consumer prices rose 2.9 percent in the year through July, falling below 3 percent for the first time since 2021. The report keeps the Federal Reserve on track to cut interest rates next month, a move that could lift economic sentiment in the United States ahead of the November election.
“We’ve won the battle against inflation,” Bharat Ramamurti, former deputy director of the National Economic Council, wrote on X. “It’s time for the Fed to begin cutting rates.”
Congressional Democrats were also using the report to push the Fed to cut aggressively.
“Inflation is down,” Senator Martin Heinrich of New Mexico, the chairman of the Joint Economic Committee, said in a news release. “The price of gas or a new car have fallen over the last year. And many families can now breathe a bit easier. Now, we need to make sure that this relief is reaching all Americans.”
Republicans have been hammering Democrats over inflation and are unlikely to let them off the hook. They continue to note that prices are up nearly 20 percent since President Biden took office and note that the labor market is showing signs of slowing.
“Despite a small improvement in the rate of price increases, the damage from the Biden-Harris administration’s philosophy of ‘tax it, regulate it, and spend it’ is done and continues to plague the economy,” said Representative Jodey Arrington of Texas, the chairman of the House Budget Committee. “It’s hard to fathom how hardworking American families can survive another four years of the Biden-Harris failed economic agenda.”
Vice President Kamala Harris, the Democratic presidential nominee, has pledged to crack down on corporate price gouging and is expected to lay out additional plans for lowering costs in a speech this week.
Former President Donald J. Trump, her Republican opponent, will hold a rally in Pennsylvania this weekend with a focus on inflation, according to his campaign. He has claimed that the Biden administration’s spending policies have fueled record levels of inflation.
“Under Kamala Harris, everything costs 20 percent more than it did under President Trump,” said Karoline Leavitt, the Trump campaign’s national press secretary. “America cannot afford another four years of Kamala’s failed economic policies.”
While Mr. Biden cheered the inflation figures, he cautioned that the cost of living remained too expensive. He said large corporations had been sitting on record profits and failing to do enough to help.
“We have more work to do to lower costs for hardworking Americans, but we are making real progress,” Mr. Biden said, while noting that wages have outpaced price increases for 17 months running. “Prices are still too high.”
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