US February Inflation Nears 8%... Biden Says Energy Prices Rise Due to Putin

[Image source=Reuters Yonhap News]

[Asia Economy New York=Special Correspondent Joselgina] Amid no signs of a quick resolution to Russia's invasion of Ukraine, U.S. inflation has surged to nearly 8%, breaking the highest level in 40 years once again. U.S. President Joe Biden pointed the finger at Russian President Vladimir Putin, stating that "the market's reaction to Putin's aggressive actions has driven up gas and energy prices, which are the causes of this month's inflation."

According to the White House on the 10th (local time), President Biden said in a statement immediately after the release of the February Consumer Price Index (CPI), "Today's inflation report reminds us that the costs Americans pay are increasing due to price hikes, and households are beginning to feel the impact of Putin's price surges," emphasizing this point.

The U.S. Department of Labor released the February CPI on the same day, showing a 7.9% increase compared to the same month last year, marking the largest rise since January 1982. Not only did this exceed the market expectation of 7.8%, but it also expanded beyond the previous month's (7.5%) largest increase since February 1982. The February CPI also rose 0.8% compared to the previous month.

Immediately after, President Biden claimed that this sharp rise in inflation was due to President Putin's invasion of Ukraine. Since Russia's invasion last month, gas and energy prices have surged, leading to these figures.

President Biden stated, "As I said from the beginning, as we impose sanctions in response to Putin's unjust war, we will pay costs domestically as well," adding, "But Americans know that the costs we impose on President Putin and his associates will be more devastating than the costs we face."

He said, "I know that rising prices affect the cost for a household, and that is why I am striving to lower the cost of living that is squeezing Americans," mentioning key measures the Biden administration is taking to ease inflation, including releasing strategic petroleum reserves, strengthening supply chains, and promoting competition to reduce prices.

This is interpreted as an early move to distance from the issue, fearing that the inflation problem will worsen and become a political burden ahead of the November midterm elections. Russia's invasion of Ukraine began on February 24, and most of the energy price increases, such as oil and gas, resulting from this were not reflected in the February CPI released on this day. The February core CPI, excluding volatile energy and food prices, soared 6.4% compared to the same month last year and rose 0.5% compared to the previous month.

By item, inflation was prominent across the board, including energy costs such as gasoline, food, and housing costs. Food and beverages recorded the largest increase since April 2020, the early stage of the COVID-19 pandemic. Housing costs rose 4.7% compared to the same month last year, marking the largest increase in 31 years since May 1991.

In particular, the market is raising the possibility that inflation in the U.S., initially expected to peak in February, may worsen further. Recently, the nationwide average gasoline price in the U.S. surpassed $4 per gallon for the first time since 2008. The prices of daily necessities directly linked to Americans' lives inevitably pose a burden on President Biden ahead of the midterm elections.

CNN pointed out, "President Biden blamed the Ukraine war for the February CPI," but noted, "Inflation had already been a major issue for several months." The Wall Street Journal (WSJ) reported, "The outbreak of war caused prices of oil, wheat, and precious metals to surge, potentially prolonging inflation," adding, "Before the Ukraine crisis, inflation was driven by surging demand for goods, supply chain disruptions such as semiconductors, and logistics chaos, but the economic turmoil caused by Russia's invasion and sanctions by countries worldwide will now worsen inflation."

This content was produced with the assistance of AI translation services.