Several regions in the US that have become hotbeds of inflation saw prices cool off in April, with the exception of one notable outlier: the Mid-Atlantic.
The Ministry of Labor announced on Wednesday Prices in the Mid-Atlantic region, which includes Pennsylvania, New York, New Jersey and Delaware, rose 7.2% year over year in April. While still below the national average of 8.3%, it’s the only region in the country where prices haven’t fallen in the last month.
INFLATION RISES 8.3% IN APRIL AND FLOWS NEAR A 40-YEAR HIGH
In comparison, inflation in the Mountain State region — Montana, Wyoming, Idaho, Nevada, Utah, Colorado, Arizona and New Mexico — eased somewhat, falling from 10.4% to 9.8% in April.
Other states are also seeing a modest slowdown in inflation, although it remains well above the national average and well above pre-pandemic levels. In the region, which includes Texas, Oklahoma, Arkansas and Louisiana, prices fell from 9.5% to 9.3%. South Atlantic prices meanwhile fell from 9.2% to 8.8%; this region includes Maryland, West Virginia, Virginia, North Carolina, South Carolina, Georgia and Florida.
Rising inflation is nagging at the sharp wage increases American workers have seen in recent months. Real average hourly earnings fell 0.1% mom in April as rising inflation wiped out overall wage growth of 0.3%, according to the Labor Department. On an annual basis, real incomes even fell by 2.6% in April.
Inflation is causing Americans to spend an additional $311 a month on goods and services on average, according to new Moody’s Analytics analysis. The financial squeeze stems from the rising costs of a range of necessities, including cars, rent, Food, Gasoline and Healthcare.
The rise in inflation has caused a political headache for President Biden, who has seen his approval rating fall as consumer prices rise.
It has also forced the Federal Reserve to embark on its most ambitious tightening mission in decades. Policymakers raised interest rates by 50 basis points in May for the first time since 2000, signaling similarly large hikes are on the table at upcoming meetings to tame inflation.
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“Inflation is way too high and we understand the distress it is causing and we are making quick efforts to bring it back down,” Fed Chair Jerome Powell told reporters last week. “Assuming economic and financial conditions develop as expected, the general view within the committee is that further hikes of 50 basis points should be on the table at the next few meetings.”