Biden Says Inflation Is 'Top Economic Challenge': How He Compares GOP, Democratic Plans

President Joe Biden delivered remarks on his economic policies and the challenges being faced by the nation on Tuesday, ahead of this week’s most closely watched economic report. Here's what investors need to know. 

What Happened: Biden spoke from the White House about his administration’s plans to fight inflation and lower the economic burden on working families.

The president said he believes "inflation is our top economic challenge right now."

The Federal Reserve “plays a primary role” in responding to rising inflation, Biden said, adding that he will “never interfere with the Fed’s judgments, decisions or tell them what they have to do.”

Biden stressed the central bank is completely independent and urged the Fed to “do its job.”

The ongoing Russia-Ukraine war is directly impacting rising inflation rates around the world, especially when it comes to food prices, since both countries are key suppliers of wheat and corn, the president said. 

Democratic Vs. Republican Inflation Strategies: When it comes to the steps Washington lawmakers can take to address inflation, Democrats and Republicans have starkly different solutions, Biden said. 

The White House's plan is to “lower everyday costs for hard-working Americans” while reducing the deficit by insisting that corporations do not engage in price gauging and pay their “fair share in taxes,” he said. 

He said congressional Republicans are calling for an increase in taxes on the middle class, while letting “billionaires and large companies off the hook as they raise prices and reap profits at record amounts.”

“It’s really that simple,” Biden added.

Also Read: Bank Analysis On Why Bitcoin Can't Serve As An Inflation Hedge

Why It Matters: The president’s remarks come ahead of the Bureau of Labor Statistics' April Consumer Price Index (CPI) report, which is set to be released on Wednesday.

Economists are anticipating CPI to increase by 8.1% in April, a slowdown from the 8.5% surge seen in March, which was the highest rate recorded in almost 40 years.

Core CPI, which excludes food and energy prices, is expected to rise by 6% on a year-over year basis, from March’s 6.5% increase.

A Bloomberg survey of economists found that they anticipate inflation to slow to an average rate of 6.9% this year, and then trend downward to 2.4% in 2024.

Photo: Created with an image from jlhervàs on Flickr.