Washington, DC – President Joe Biden’s recent assertion that inflation in the United States has diminished and is now lower than in any other major global economy faced scrutiny on social media, as users pointed out that countries such as Canada and Japan currently boast lower inflation rates.
Taking to X, formerly known as Twitter, on Monday, the President stated, “Inflation is coming down in the U.S. It’s now lower in America than any other major economy in the world. And the costs of essential items, including gas, are coming down too.” Biden highlighted the decline in inflation, which had previously peaked at 9.1 percent in June 2022, indicating a significant reduction. By December 2023, U.S. prices had risen by 3.4 percent compared to the same month in 2022, prompting the Federal Reserve to announce the cessation of its aggressive rate-hiking campaign.
While it is true that prices are increasing at a much slower rate than in recent years, it is worth noting that inflation remains higher than the Federal Reserve’s target of 2 percent.
Biden has touted the reduction in inflation without triggering a recession as a success of his economic plan, known as “Bidenomics.” However, his claim that the U.S. currently has a lower inflation rate than any other major economy in the world was met with skepticism on social media. Users utilized X’s “community notes” feature to provide context to the President’s statement, revealing that in November 2023, the annual U.S. inflation rate was 3.1 percent—on par with Canada but higher than Japan during the same period. While U.S. inflation is lower than that of several European countries, including France and Germany, which reported a 3.7 percent annual inflation rate in December 2023, it is comparable to the European Union’s inflation rate of 3.4 percent for the same month.
The resilience and unexpectedly strong performance of the U.S. economy are anticipated to work in Biden’s favor in the upcoming November 5 election, shaping up to be a rematch between the Democrat and former President Donald Trump. The latest GDP report indicates a 3.3 percent annual growth rate in the U.S. economy last quarter, showcasing continued consumer spending despite high interest rates and elevated prices.
The annual inflation rate in the US went up to 3.4% in December 2023 from a five-month low of 3.1% in November, higher than market forecasts of 3.2%, as energy prices went down at a slower pace. Energy costs dropped 2% (vs -5.4% in November), with gasoline declining 1.9% (vs -8.9%), utility (piped) gas service falling 13.8% (vs -10.4%) and fuel oil sinking 14.7% (vs -24.8%). Meanwhile, prices increased at a softer pace for food (2.7% vs 2.9%), shelter (6.2% vs 6.5%), new vehicles (1% vs 1.3%), apparel (1% vs 1.1%), medical care commodities (4.7% vs 5%) and transportation services (9.7% vs 10.1%) and continued to decline for used cars and trucks (-1.3% vs -3.8%). Annual core inflation rate eased to 3.9%, below 4% in the previous period but above expectations of 3.8%. Compared to November, consumer prices went up 0.3%, the most in three months and above forecasts of 0.2%. source: U.S. Bureau of Labor Statistics