The Chicago Fed shares optimism for jobs and economy
The chair of the Chicago Fed shares optimism for the rest of 2022.
President Joe Biden: “I just want to say a number: zero. Today we received news that our economy had 0% inflation in the month of July. Zero percent. Here's what that means. While the price of some things go up went up last month, the price of other things went down by the same amount. The result? Zero inflation last month.”
This week, President Biden shared economic news filled with optimism in the ongoing nationwide fight against high inflation. The Bureau of Labor Statistics released what some analysts have called surprising data for last month’s Consumer Price Index where the CPI remained unchanged for the month of July. With an annual inflation rate now at 8.5 percent, Biden was upbeat about the nation’s economy.
President Joe Biden: “When you couple that with last week's booming jobs report of 528,000 jobs created last month and 3.5% unemployment, it underscores the kind of economy we've been building.
One economist watching inflation rates closely is Federal Reserve Bank of Chicago President Charles Evans. Evans was in Des Moines, Iowa sharing his insights on recent economic findings.
Charles Evans, President, Federal Reserve Bank of Chicago: “So it's natural to ask the question when you see growth stall or be negative, or is this the beginning of a recession? And I think the answer to that is ‘no.’ Um, we are tightening monetary policy at the moment and, um, you know, we're at about two and a half percent on the short term policy rate, that's a neutral level. And that's because we've got very high inflation.”
Evans noted, statistics in the latest CPI report help support his cautious optimism for what the economy might have in store for the remainder of 2022.
Charles Evans, President, Federal Reserve Bank of Chicago: “It is an unusual economy and inflation is high for unusual reasons. Supply chains have been difficult. They've caused, uh, uh, higher prices. Relative prices have gone up, and labor force has been slow to come back. But saying that businesses are hiring, uh, vacancies are continuing to be up and people who are looking for a job, can find them, even in the environment with rising rates. And so I'm optimistic, the economy will continue to grow, grow well in the second half, so that we'll definitely have positive growth this year. And that we'll continue that into next year while inflation is coming down.”
For Market to Market, I’m John Torpy