CEA Chair Jared Bernstein Touts Fall In Inflation Under Biden Administration But Says More Needs To Be Done

White House Council of Economic Advisers Chair Jared Bernstein has reportedly said although the headline inflation is down significantly over the last year, the administration will keep working towards bringing price rises under control.

"We are going to continue to implement particular aspects of the Inflation Reduction Act that will continue to provide some breathing room for households," Bernstein told Bloomberg TV.

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May CPI rose 4% annually, registering the lowest rise in two years. Core CPI, which strips out energy and food, rose 0.4%. Highlighting the fall in the headline CPI, Bernstein said it's a big drop but also noted more needs to be done.

“But we are not satisfied with that. We have more work to do. We want to keep pushing that trend in the right direction. Lowering the cost of insulin, lowering the cost of prescription drugs, lowering the cost of clean energy, and appliances and electric vehicles, batteries. That’s all part of our implementation agenda for the legislated Inflation Reduction Act. That’s very much on our minds,” he said.

Bernstein's comments come at a time when investors and traders have begun weighing the possibility of extended rate hikes following the higher-than-expected inflation in the U.K. where CPI rose 8.7% from a year ago in May.

On Housing: Federal Reserve Chair Jerome Powell acknowledged the hardship caused by high inflation and reiterated the Fed's dedication to bringing inflation back down to the 2% goal, during his Wednesday testimony before the House Financial Services Committee. Powell also said housing inflation will come down over the course of the rest of this year and the next.

“Some of this is very mechanical. It’s just the way the lag works in the CPI and the PCE deflator. So, that rollover in the second half of this year should be helpful in terms of maybe nudging the core down a bit and helping with the headline as well,” Bernstein said, while commenting on housing inflation.

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