President Donald Trump has responded to new economic data showing that US inflation rises to 4.2%, the highest annual rate recorded in three years.
Figures released by the Bureau of Labor Statistics (BLS) on Wednesday showed that consumer prices increased by 4.2% in May compared with the same period last year. The latest reading was up from 3.8% in April, with higher energy costs playing a major role in the increase.
Reacting to the report at the White House, Trump said: “I love it. The numbers were great. You know what I really love? I love the inflation.”
The president later clarified his remarks in an interview with the New York Post, saying he was referring to the fact that inflation was lower than some analysts had expected despite ongoing conflict involving the United States, Israel and Iran.
“I love the inflation numbers because of what I’m talking about,” Trump told The Post. “The numbers are going to be phenomenal because what’s showing is that despite the fact that we’re in a war, the numbers are much lower than anticipated, and when we’re out of that war, the numbers will be at lower numbers than they were even before it started.”
Trump maintained that inflation pressures would ease once tensions with Iran subside. He told reporters that oil prices are expected to fall when the conflict ends.
“When this conflict is over… you will see oil drop to where it was before,” he told reporters in the White House.
The president also pointed to fuel prices he observed during a visit to Iowa earlier this year, saying gasoline prices could return to lower levels in the near future.
The rise in inflation comes as the US Consumer Price Index (CPI) recorded its third consecutive monthly increase. The CPI measures changes in the prices consumers pay for goods and services over time.
According to the BLS report, energy costs were a major driver of the increase. Gasoline, electricity and other energy-related expenses rose sharply compared with a year ago.
The report also showed increases in the cost of airline tickets, medical care, personal services, recreation and communication.
Data from the American Automobile Association (AAA) showed that the national average price of regular gasoline reached $4.15 per gallon, compared with $2.98 per gallon in late February.
Analysts have linked rising energy prices to disruptions in global oil supply following tensions in the Middle East. Iran’s actions around the Strait of Hormuz, a major shipping route for oil and gas, have raised concerns about supply shortages and higher energy costs worldwide.
The latest inflation figures present a challenge for policymakers at the Federal Reserve, whose long-term inflation target remains 2%.
Higher inflation often increases the likelihood of interest rate hikes, as the central bank seeks to slow spending and stabilize prices. Such moves can raise borrowing costs for households and businesses.
The issue also carries political significance ahead of the upcoming midterm elections, with many voters continuing to rank the economy and cost of living among their top concerns.
While inflation remains well below the 9.1% peak recorded in 2022, economists are divided on what comes next. Some believe current data may not be enough to justify higher interest rates immediately, while others argue that continued price increases could force the Federal Reserve to act.
Federal Reserve Governor Kevin Warsh is expected to face close scrutiny ahead of his first interest rate decision next week, as markets watch for signs of how the central bank plans to respond to rising inflation.
- BBC