December CPI: Biden touts 'good news' as prices dropped 0.1%

The price for all consumer goods increased by 6.5% on an annual basis, down from double-digit levels last year.

U.S. President Joe Biden said Thursday the American economy is on the mend after struggling under the strains of double-digit inflation for much of last year, pointing to cooling gas and food prices as proof. Photo by Bonnie Cash/UPI
1 of 5 | U.S. President Joe Biden said Thursday the American economy is on the mend after struggling under the strains of double-digit inflation for much of last year, pointing to cooling gas and food prices as proof. Photo by Bonnie Cash/UPI | License Photo

Jan. 12 (UPI) -- President Joe Biden presented "good news" about the U.S. economy Thursday as the Commerce Department reported that consumer prices declined at the end of 2022.

The December Consumer Price Index showed the price for all consumer goods declined by 0.1% from November levels.


"Today we got some good news, good news about the economy. For the sixth month in a row, inflation has come down," Biden said Thursday morning, during a speech specifically addressing the economy and inflation.

Prices increased by 0.1% month-on-month from October to November. For all consumer goods, prices increased by 6.5% over the 12-month period ending in December, the smallest increase in that span since the period ending in October 2021.


"Food inflation is slowing as well. Last month we saw the smallest increase in food prices in almost two years. And much of that increase is due to the Avian Flu outbreak, which has driven up the egg prices in the United States," Biden said Thursday.

"It's not just gas and food prices though. When we look at what economists call core inflation, which takes out energy and food, we see welcome news as well."

Double-digit, year-on-year growth is still evident in the prices for food, energy and transportation, though it was the energy component of the Consumer Price Index that helped contribute to recent declines.

"The energy index decreased 4.5% over the month as the gasoline index declined," the report from the Commerce Department read.

Biden spent much of last summer rallying against the steady rise in consumer gasoline prices, arguably one of the more ubiquitous signs of consumer-level inflation. The price at the pump reached $5 per gallon last summer, but at $3.27 per gallon, retail gasoline prices remain more or less even with year-ago levels.

Crude oil prices account for the bulk of what consumers see at the pump and those prices are on the rise, suggesting inflationary strains are not yet over. That was echoed last week in the latest minutes from the Federal Open Market Committee, where Federal Reserve officials said they've made "significant progress" in the fight against inflation, but it would be a "misperception" to think that policymakers would ease back on the rate hikes from last year.


Nevertheless, the White House said the latest reading on inflation showed that a transition to stable growth and a so-called soft landing, the possibility of only a very minor recession, was in the cards for the world's leading economy.

"The data is clear. Even though inflation is high in major economies worldwide, it's coming down in America month after month, giving families some real breathing room. The big reason is falling gas prices. My administration took action to get oil onto the market and bring down prices. Now gas is down by more than $1.70 at its peak," Biden told reporters Thursday.

The number of people filing for unemployment insurance through last week decreased slightly, the Labor Department reported. The total of 205,000 was 1,000 less than the previous week, which had been on an upward trend.

"As inflation is coming down, take home pay for workers is going up. Workers' wages are higher now than they were seven months ago, adjusted for inflation. Wages for lower and middle income workers have gone up even more."

An average of 212,500 people per week have filed for unemployment over the last four weeks, about 1,750 fewer than the previous four-week period.


Alaska (2.3%), Minnesota (2.2%) and New Jersey (2.2%) had the highest weekly unemployment rates during the last week of the 2022. With 4,514 new claims during that week, New Jersey saw the biggest increase, followed by Michigan with 3,322 new claims, and New York's 3,169 first-time claims.

"Unemployment is the lowest its been in 50 years. I'll say that again, the lowest unemployment in half a century. Today, the unemployment rate is near record lows for Blacks and Hispanics," Biden said Thursday.

During the speech, Biden extended an invitation to new House Speaker Kevin McCarthy, R-Calif., to work together, while at the same time taking aim at the new Republican majority.

"House Republicans campaigned on inflation. They didn't say if elected they would make inflation worse," Biden said.

"Plus, House Republicans introduced another bill, blocking action that would help lower gas prices and help consumers. And on top of that, House Republicans are preparing to vote on a national sales tax bill. It would raise taxes on everyday items by taxing everyday items from groceries to gas, while cutting taxes for the wealthiest Americans."

He then assured reporters he is prepared to stand against any such legislation.


"If any of these bills make it to my desk," Biden said, pausing, leaning close to the microphone and reducing his voice to a whisper for dramatic effect. "I will veto them."

"I will flat veto them. I'm ready to work with Republicans, but not this kind of stuff."

Not everyone is painting a rosy picture. Warnings from the International Monetary Fund and the World Bank that forecast that much of the global economy will enter some form of recession this year. The U.S. economy will likely be spared, though the economies of Europe will continue to face headwinds for much of the year with zero growth expected for 2023.

"Today's inflation numbers are good news, good news for our economy. But we have more work to do. We're on the right track," Biden said during his closing remarks.

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