ICYMI: This Week in Economics: Inflation Falls, Small Business Boom Continues, Retail Sales Strong

This week, we saw continued economic progress under President Biden and Vice President Harris: Inflation fell below 3% to the lowest level since March 2021, retail sales beat expectations, and the small business boom continues—with 19 million new business applications filed under this Administration.

There's more to do. The President and Vice President are fighting for a future that lifts all Americans—from lowering costs by building more homes and negotiating lower prescription drug costs to cutting taxes for workers and middle class families. All while Congressional Republicans try to take us back by giving tax cuts to billionaires and big corporations.

Read more below:

CBS Evening News:Inflation drops below 3% for first time since 2021

MAJOR GARRETT: "There is good news on the economy tonight with inflation falling to its lowest level in more than three years." […]

JARED BERNSTEIN: I have three words for people who feel the way you just said, which is "we hear you."

CBS: Inflation continues to cool ahead of the Federal Reserve's next rate decision
[Kate Gibson, 8/14/24]

Prices rose 2.9% in July from a year earlier, down from 3% in June, marking the smallest 12-month increase since March 2021, when prices accelerated in the wake of the pandemic.

"We're moving in the right direction on inflation, and doing so with some momentum," Jared Bernstein, chair of the Council of Economic Advisers, told a White House press briefing on Wednesday afternoon.

Importantly, "wages have risen faster than prices for 17 months" on an annualized basis for median and low-income workers, Bernstein noted. Still, "too many families are facing too high costs," the economist said, citing housing and health care costs.

NPR's Morning Edition:Inflation fell to its lowest level in more than three years in July
[Scott Horsley and Steve Inskeep, 8/15/24]

HORSLEY: Well, inflation continues to moderate. Consumer prices in July were up just 2.9% from a year ago. That's the smallest annual increase in more than three years. Inflation has come down by more than two-thirds from its peak back when Russia invaded Ukraine. Gasoline prices are actually down in the last year, so are airfares and used cars. And falling inflation is very much what economists have been waiting to see. But White House economist Jared Bernstein concedes we're not yet back to where a lot of average people want us to be.

JARED BERNSTEIN: The momentum is certainly in the right direction. Inflation is reliably coming down. And so this is a consistent trend that's moving in the right direction. No victory laps. We still have to be mindful that too many families are facing too many high costs.

Bloomberg's Balance of Power: US Inflation Eases for Fourth Straight Month

JARED BERNSTIEN: "Not only are we moving in the right direction, but we have some momentum…The baseline forecast is one for a transition to steady stable growth, where the strong job market continues to support consumer spending. An interesting and important lynchpin into that, by the way, is the fact that we now have 17 months in a row of year-over-year wages beating prices for middle-wage workers."

CNN: Inflation milestone: Consumer Price Index slows below 3% for first time since March 2021
[Alicia Wallace, 8/14/24]

Jared Bernstein, the chair of the White House Council of Economic Advisers, on Wednesday touted the latest CPI data but also pledged "no victory laps."

"Our work is not done, because even as we get inflation back down to pre-pandemic levels, we still have to be mindful that too many families are facing too many high costs," he told reporters during Wednesday's White House press briefing.

New York Times: Inflation Cools to 2.9%, Shoring Up Case for a Fed Rate Cut
[Jeanna Smialek, 8/14/24]

"It's great to see a 'two' handle on the yearly C.P.I.," Jared Bernstein, chair of the White House Council of Economic Advisers, said in an email following the release. "It doesn't mean our work is done, but it does mean we're moving in the right direction, and with a bit of momentum."

Washington Post: Inflation hits lowest level since spring 2021, most likely teeing up rate cuts
[Rachel Siegel, 8/14/24]

Jared Bernstein, chair of the White House's Council of Economic Advisers, hailed the "solid disinflation" as good news. But in an interview with The Washington Post, he said the administration is keeping its focus on ways to relieve everyday costs for rent, prescription drugs and more.

"We're very happy to see lower inflation, to see it have some momentum," Bernstein said. "But that's not going to stop us from continuing to lower costs wherever we can."

CNN: Sales at stores are suddenly surging in the US economy's latest show of strength
[Bryan Mena, 8/15/24]

The backbone of America's economy remains solid […]

Sales at US retailers unexpectedly surged in July, the Commerce Department said Thursday, rising by a solid 1% from the prior month, up from June's downwardly revised 0.2% decline. That trounced economists' expectations of a 0.3% gain.

Retail sales, which are adjusted for seasonal swings but not inflation, make up a sizable chunk of overall spending. July's reading is a boon for the US economy because the country's economic growth hinges on Americans spending their dollars.

It is the economy's latest show of strength in the face of several economic hurdles squeezing the US consumer.

Bloomberg: Biden Invests $100 Million to Fuel Housing Construction
[Kriston Capps, 8/13/24]

The White House is announcing $100 million in grants to state and local governments to spur the construction of new housing, one of a host of new administrative actions to boost housing supply.

The Biden administration has witnessed record levels of housing production, driven by a pandemic-era boom in apartment buildings. More housing units are under construction now than at any point in half a century — some 60,000 multifamily units were completed in June alone — and rents are stabilizing in some areas as a result.

Yet the production of single-family homes remains meager, reaching a four-year low in June, and overall housing construction levels, while still high, have been sliding since December. With the Federal Reserve holding interest rates steady and Senate Republicans blocking a $78 billion tax deal that would shore up housing tax credits, the White House is using other tools to try to keep the pipeline flowing.

Actions across a number of cabinet-level agencies will address permitting, financing and regulations in order to speed up construction.

Inc.: The Small Business Boom Isn't Slowing Down
[Ali Donaldson, 8/16/24]

The small business boom shows no signs of abating.
Americans keep turning to entrepreneurship at near record levels. So far this year, 3.02 million new business applications have been filed--a level outpacing eight of the past ten years and just under the all-time highs recorded in 2021 and 2023.
[…]
Since President Biden took office, 19 new million businesses have formed. Typically, between 7 and 9 percent of businesses shutter each year, but that closure rate has been trending downward recently. Of the 33.3 million small businesses nationwide, 917,825 businesses--or 2.8 percent--shut down and 1.4 million new establishments opened between March 2021 and March 2022.