Well by that reasoning, there’s almost NEVER “zero inflation”, right? If you want the phrase “zero inflation” to carry only the meaning “an annual inflation rate of 0.0%”, then the phrase can almost never be used at all.
I thought it was pretty clear that what Biden meant by his use of it: namely, that prices did not inflate (increase) at all last month.
So why didn’t he say something like “inflation is trending downward, in fact a half point in July”? “Zero inflation” is just nonsense.
Well, if what he said is in fact seriously confusing to a lot of people, then that’s a valid reason to suggest finding a different way to express it.
If it’s just you who are bothered by it, though, then I don’t think it’s such a big deal, as you have access to the wisdom of Dopers like RitterSport to resolve the confusion. Thanks, RitterSport! 
Here’s an article that might explain things.
I don’t understand what you mean by “half of point in July”. Prices were flat in July. The annual inflation rate was down 0.6% from the previous month, not 0.5%, right?
If your 0.5% is meant to refer to the 0.6% actual decrease, it sounds like you think he should undersell the decrease in inflation. Do I have that right?
Oh, I see. It’s just the latest right wing misinformation. @D_Anconia, you should improve your news sources.
Lol, love this. Watching @D_Anconia flap around like a fish trying to convince us he doesn’t understand the difference between June 1 2022 - June 30 2022 and June 2021 - June 2022 wasn’t the Wednesday night I planned for, but it’s the one I will take.
It is true that the month-over-month CPI inflation rate was 0% for July. However…
Almost all of that decrease came from decreasing costs for gas, fuel oil, and natural gas. Airline tickets and new car prices also came down.
On the other hand, electricity is up 15.6%, food is up 10.9% (the largest increase since 1979), shelter is up 5.7%, and used cars are up 5.7%. Core inflation is up 5.9%.
Notice a difference? Why is one group down and the other up? Well, the first group is far more elastic than the second, and the U.S. is in a recession. The second group of items is stuff is made up of recession-resistant goods, and they are still inflating. The fact that new car prices are dropping while used car prices increase is another recession signal.
In addition, airline prices are affected by lower fuel prices, and seasonally prices generally decline towards the end of summer as vacation season ends. Also, one ‘price’ for air travel is delays, and air travel is a mess right now. Ticket prices may have come down a bit to compensate.
Gas, oil and natural gas have fallen because the futures prices are falling - a sign that the markets expect further slowdowns in the economy.
Also, the producer price index went UP from last month, from 11% to 11.3%. Producer inflation leads consumer inflation, so that’s not good.
So the inflation news isn’t the big win Biden is portraying it as. All the stuff people can’t do without are still inflating, and more rapidly than they did ladt month. The stuff that’s more optional is falling because the economy is shrinking. Oil and gas are declining because the markets are now pricing in a recession.
? What “big win” portrayal? The Reuters article containing the “zero inflation” quote that D_Anconia reopened this thread to complain about put it like this:
If we’re identifying sources of misinformation and misrepresentation about the current economic situation, it doesn’t seem to me that Biden’s remarks are even close to being in the top ten.
When the yearly inflation rate decreases to “only” 8.5%, the difference between .5 and .6 is negligible to people IRL. Especially when it comes to food at 10.9% and shelter at 5.7%.
@Sam_Stone, you seem to be arguing against things no one here said, and Biden didn’t say. I’m not sure why. Core inflation was up, so the Fed will probably continue raising rates.
@D_Anconia, if the annual inflation rate went down by 0.4% and Biden said it was “half a point”, you’d be all over him for overselling it. If he said “inflation is trending downward, in fact half a point in July”, RW media would rightfully point out that it was flat in July and still up over 8% from last year, and you’d be all over him for that. I understand that nothing he could have said would actually satisfy you.
That is irrelevant to your errors here, which you should have the courtesy to acknowledge.
Of course, you mean the CPI according to the US Labor Department as reported by Reuters, which was linked in your article, and did indeed state that:
If you wanted to present Biden as the one who was clueless, take care to read the articles you cite. Now where would you like to walk your error back to?
May, 2021.
I’m trying to understand what could possibly make the above seem like a valid criticism. Maybe not understanding how annualized rates work?
The price increases already happened. They’re not going to revert. If they stop, the annualized rate will stay elevated until the past increases drop off. Two more months of “zero inflation” would still leave us at an annualized rate of 7.7%.
I guess he’s rooting for a massive deflation, which would be the only way to get the 12-month trailing number to 0%.
[Biden said] “We’re seeing a stronger labor market where jobs are booming and Americans are working, and we’re seeing some signs that inflation may be beginning to moderate.” …
The slower price increases are also likely to reassure the Federal Reserve, which has been waiting for any sign that inflation is starting to moderate. But central bankers are likely to see this as a first step in the right direction rather than a definitive victory, because the cost of many goods and services continued to pick up rapidly even as gas and travel-related price declines pulled overall inflation lower.
“On the surface, this is good news for the Fed,” said Omair Sharif, founder of Inflation Insights. “This is the first baby step toward the moderation they want to see on a regular basis.”
No one is declaring victory, and times are still bad for many.
For many Americans who are struggling to adjust their lifestyles to rapidly climbing costs at the grocery store and dry cleaners, an annual inflation rate that is still more than four times its normal speed is unlikely to feel like a big improvement, even as lower gas prices and rising pay rates do offer some relief.
We need a year of 0.6% drops to go back to a desired number. Any number of disasters may occur before then. Maybe the Republicans will continue to vote against an insulin cap, a $19-27 monthly decrease in family costs. Have to wait and see.
So, this appears to be incorrect. PPI fell 0.5% last month.
Cite: https://www.cnbc.com/2022/08/11/producer-price-index-july-2022-.html
Looks like futures are now predicting a 50bps rise by the Fed. I think it was 75 bps before the CPI and PPI prints.
Falling CPI and PPI may be good from an inflation perspective, but may be early indicators of a recession, which I agree is not good. Here’s hoping for a soft landing.