According to the latest Wall Street Journal poll of U.S. election battleground states, a surprising 74% of respondents believe that inflation has moved in the wrong direction over the past year. However, experts are quick to point out that this belief is simply not based on facts.
In reality, data from the Consumer Price Index (CPI) shows that U.S. inflation has actually decreased over the past year. In the 12 months leading up to February, inflation stood at 3.2%, compared to 6% a year earlier. Even when excluding food and energy prices, inflation has continued to fall.
Despite this evidence, the public perception of rising inflation is concerning, especially for President Joe Biden’s re-election hopes. It seems that feelings are contradicting facts when it comes to economic matters, leading to a disconnect between reality and sentiment.
A recent study from the Brookings Institution revealed that many people have an incorrect understanding of inflation, often confusing it with high prices or “price gouging.” This misunderstanding, combined with negative media coverage and broader feelings of pessimism about the country, may be contributing to the misperception of rising inflation.
While there have been challenges such as inflation and shortages in recent years, data shows that the economy has been improving. However, changing the public’s negative perception will require more than just addressing inflation; it will require addressing underlying feelings of pessimism about the state of the country.