Inflation moderates in some hot spots, but barrels ahead in the mid-Atlantic
Mid-Atlantic inflation held steady last month, only region that didn't see price drop
FOX Business' Jeff Flock reports from a Philadelphia townhome for rent on 'Varney & Co.'
Several regions in the U.S. that have become a hotbed for inflation saw prices cool in April, except for one notable outlier: the mid-Atlantic.
The Labor Department reported Wednesday that consumer prices in the mid-Atlantic region, which includes Pennsylvania, New York, New Jersey and Delaware, rose by 7.2% in April from the previous year. While that is still below the national average of 8.3%, it is the only region in the country that did not see prices pull back last month.
INFLATION SOARS 8.3% IN APRIL, HOVERING NEAR 40-YEAR HIGH
By comparison, in the Mountain state region — Montana, Wyoming, Idaho, Nevada, Utah, Colorado, Arizona and New Mexico – inflation moderated somewhat, falling from 10.4% to 9.8% in April.
Other states are also experiencing a slight slowdown in inflation, although it remains well above the national average and far higher than pre-pandemic levels. Prices fell from 9.5% to 9.3% in the region that includes Texas, Oklahoma, Arkansas and Louisiana. Prices in the South Atlantic, meanwhile, fell from 9.2% to 8.8%; that region encompasses Maryland, West Virginia, Virginia, North Carolina, South Carolina, Georgia and Florida.
Rising inflation is eating away at strong wage gains that American workers have seen in recent months. Real average hourly earnings decreased 0.1% in April from the previous month, as the inflation increase eroded the 0.3% total wage gain, according to the Labor Department. On an annual basis, real earnings actually dropped 2.6% in April.
On average, Americans are shelling out an extra $311 a month on goods and services because of inflation, according to a new Moody's Analytics analysis. The financial squeeze stems from the rising cost of a number of everyday goods, including cars, rent, food, gasoline and health care.
Fruit is displayed inside a store on May 12, 2022 in New York City. Prices of clothing, food, gas and cars are just a few of the items that are hitting Americans' pocketbooks despite historically low unemployment. ((Photo by Spencer Platt/Getty Images) / Getty Images)
The inflation spike has created a political headache for President Biden, who has seen his approval rating plunge as consumer prices rise.
It has also forced the Federal Reserve to embark on the most ambitious policy tightening mission in decades. Policymakers raised the benchmark interest rate by 50 basis points in May for the first time since 2000 and have signaled that similarly sized hikes are on the table at coming meetings as they seek to tame inflation.
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"Inflation is much too high, and we understand the hardship it is causing, and we are moving expeditiously to bring it back down," Fed Chairman Jerome Powell told reporters last week. "Assuming that economic and financial conditions evolve in line with expectations, there is a broad sense on the committee that additional 50 basis point increases should be on the table at the next couple of meetings."