NEW YORK, NEW YORK – JULY 13: Traders work on the floor of the New York Stock Exchange during morning trading on July 13, 2022 in New York City. The stock market opened on a low note amid the release of inflation data by the Labor Department that showed U.S. inflation reaching 9.1% in June, the highest rate in nearly 41 years. Americans are seeing increased prices, including gas, food and rent. Michael M. Santiago/Getty Images/AFP (Photo by Michael M. Santiago / GETTY IMAGES NORTH AMERICA / Getty Images via AFP)
The White House said it expects June inflation data due out on Wednesday to be “highly elevated,” hours before the release of the latest consumer price index.
US President Joe Biden has seen his approval ratings plummet as Americans face the worst inflation surge in more than 40 years.
Promising to do whatever it takes to rein in price rises, the Federal Reserve has launched a series of aggressive interest rate hikes that have fueled concerns the country could tip into recession.
“We expect the backwards looking inflation data to be highly elevated, mainly because gas prices were so high in June,” press secretary Karine Jean-Pierre said aboard Air Force One as she traveled with Biden to the Middle East.
With inflation running at a 40-year high in the US and gasoline prices near $5 a gallon, the Bureau of Labor Statistics was due to report the Consumer Price Index for June later on Wednesday morning.
Wall Street stocks fell Tuesday as markets gird for a potentially grim US inflation report.
Inflation in May hit a yearly rate of 8.6 percent and analysts expect it to reach 8.8 percent in the June figures.
Analysts expect headline consumer prices rose 1.1 percent in June, even faster than the level in May. However, a slower increase is expected when food and energy is excluded.
Traders fear that another report showing hot inflation will lead the Federal Reserve to double down on large interest rate hikes after the central bank announced in June it was boosting rates by three-quarters of a point, the biggest increase in nearly 30 years.
Biden will make his first visit as US president to Saudi Arabia on Friday. He will seek to persuade Riyadh to pump more oil so as to bring down prices that are fuelling the sky-high inflation in the US.
© Agence France-Presse