New evidence that inflation is going down in the U.S. comes from the consumer price index, which fell for the first time in four years.
The drop was mostly due to lower prices for petrol RB00, -0.18% and used cars. The June CPI report also showed that housing costs were rising more slowly.
Even though the Federal Reserve doesn’t like the CPI as a measure of inflation, Thursday’s report makes it more likely that the bank will lower interest rates by September.
A few weeks ago, the CPI report would have been very helpful for President Joe Biden’s campaign to keep his job. But right now, inflation isn’t the biggest issue for the Democratic incumbent.
That’s why Biden, who is 81 years old, and his staff are still getting calls that he should drop out of the race for president after a bad debate two weeks ago against Trump, who is 78 years old and is expected to be the Republican nominee.
At a news conference on Thursday at 6:30 p.m. Eastern, Biden hopes to calm some people’s worries by doing a good job. The meeting with reporters takes place as the NATO summit in Washington, D.C., comes to an end.
Wednesday brought more criticism for the president. Peter Welch of Vermont became the first Democrat in the Senate to call for Biden to step down, and Nancy Pelosi, the former Speaker of the House, broke ties with Biden. Also, famous donor George Clooney said the commander-in-chief shouldn’t be running, and unnamed sources told Axios that Senate Majority Leader Chuck Schumer has privately said he’s open to getting rid of Biden, even though he says in public all the time that he’s “for Joe.”
One betting site, PredictIt, said that Vice President Kamala Harris had a better chance than Biden of becoming the Democratic nominee in 2024. This change came after Biden had a better chance at the beginning of the week. Around noon Eastern time on Thursday, she was worth 45 cents and he was worth 39 cents.
An ABC News/Washington Post/Ipsos poll released Thursday found that two-thirds of Americans think Biden should end his campaign because of how he did in the first presidential debate and half of Americans think the same thing about Trump.
In a letter to Democratic lawmakers on Monday, Biden said, “firmly committed to staying in this race, to running this race to the end, and to beating Donald Trump.” He has said this many times. Then Pelosi said that Biden should “make that decision, because time is running short,” making it look like he hadn’t decided yet.
It looks like Trump isn’t announcing his running mate yet so that the attention stays on Biden while he and the other Republicans get ready for their convention next week in Milwaukee. A RealClearPolitics average of national polls now shows that the former president is ahead by 3 points, up from 1.5 points the day before the debate. In swing states, Trump now has a 4 point lead over Clinton, up from 3.2 points two weeks ago.
Analysts have different ideas about what Biden should do next.
According to Terry Haines, founder of Pangaea Policy, every day that Biden stays strong and avoids another bad performance makes it more likely that he’ll stay in office as president and the Democratic nominee.
In a note, Haines said, “The only thing that matters is whether senior, important Democrats publicly stand against Biden. But Democratic leaders are still publicly supporting Biden, so they can’t easily climb off that branch on their own, and Biden won’t let them climb down.”
Greg Valliere, chief U.S. policy strategist at AGF Investments, said that the question isn’t whether Biden will step down, but when.
Valliere wrote in a note that the resignation “could happen as soon as his press conference today, but it’s more likely not until late July, before the Democrats’ national convention, which runs from August 19–22.”
As part of his plan to fix things after the debate, Biden is going to do an interview with NBC News host Lester Holt on Monday.
The most recent CPI report “shows that we are making significant progress fighting inflation,” Biden said in a statement Thursday. However, he also said that prices are “still too high” and that big companies “need to do more to lower prices.” He also said that he is “taking on” Big Pharma, Big Oil, and Wall Street to “give families more breathing room.”
After the report on inflation, the Dow industrials DJIA went up slightly on Thursday. However, the S&P 500 SPX and Nasdaq Composite COMP went down as traders pulled their money out of tech stocks.
