The government is expected to report Wednesday that consumer prices jumped 8.1% last month compared with a year earlier.
Biden blamed chronic supply chain snarls related to the swift economic rebound from the pandemic, as well as Russia's invasion of Ukraine, for igniting inflation. He said his administration will help ease price increases by shrinking the government's budget deficit and by fostering competition in industries, like meatpacking, that are dominated by a few industry giants.
Earlier signs that U.S. inflation might be peaking didn't last. Price increases decelerated last August and September, suggesting at the time that higher inflation might be temporary, as many economists — and officials at the Federal Reserve — had suggested. But prices shot up again in October, prompting Fed Chair Jerome Powell to start shifting policy toward higher rates.
Another factor will be how sharp price increases from a year ago affect the new inflation calculations. The prices of many goods spiked last spring as the economy reopened and a surge in demand overwhelmed supplies. But this year, monthly price increases for many goods have been slowing. That may have effect of easing the year-over-year inflation rate.
Inflation is at a 40-year high and interest rates are going up too. So potential homebuyers might need to set their sights on a cheaper home in a more affordable area, while other potential buyers might back out of the market for now, says Lawrence Yun, chief economist for the National Association of Realtors.
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