WASHINGTON — Inflation in the United States reached 3.8 percent in April compared to a year earlier. Kevin Hassett, director of the National Economic Council, said that inflation is primarily a "blue state" issue.
Hassett said, "Inflation is really out of control in the blue states. If you take out New York and California the story is radically different. So these really high costs, high regulatory states are driving inflation as well." Omair Sharif, chief economist at Inflation Insights, responded. Sharif said, "It’s not a blue state story. Gas is going up in every state." Inflation rates are elevated across all nine national regions tracked by the Census Bureau.
The Pacific region, comprising California, Washington, Oregon, Hawaii, and Alaska, reported a 3.5 percent annual inflation rate in April. In comparison, the East South Central region, comprising Mississippi, Alabama, Kentucky, and Tennessee, reported a 4.5 percent annual inflation rate, and the West South Central region, comprising Texas, Oklahoma, Arkansas, and Louisiana, reported a 3.2 percent rate. Nationwide gas prices have increased by more than 40 percent since late February. The average price of gasoline in Texas was $3.72 per gallon on Thursday, an increase of approximately 36 percent compared to the previous year. California's average gasoline price was $5.98 per gallon on Thursday, a 26 percent increase from the previous year. Rising fuel costs have increased air fares, shipping expenses, and grocery prices nationwide. Clothing prices have increased nationwide.
Hassett said that core inflation is nearing the Federal Reserve's target. He stated, "It’s on a deep downward dive if you look at the trimmed mean or the core, it’s headed right towards the Fed’s target." Core inflation, as measured by the consumer price index, increased from an annual rate of 2.5 percent in January to 2.8 percent in April. The personal consumption expenditures price index, another measure of core inflation, increased to 3.3 percent in April from 3.1 percent in January. Sharif said, "There’s no deep dive happening in core inflation anywhere."