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What may happen to the economy as gas prices continue to rise
04:24 - Source: CNNBusiness
CNN  — 

The White House is bracing for a new inflation report coming out Thursday that it expects will show continued high prices for Americans.

The consumer price index, a key report indicating inflation in the US, will be released by the Bureau of Labor Statistics at 8:30 a.m. ET Thursday. Last month’s report showed inflation rose to 7.5% in the 12 months ending in January, a near-40-year high.

“As we’re looking ahead, we certainly assess that we expect to see a high headline and headline inflation in tomorrow’s February inflation data,” White House press secretary Jen Psaki said Wednesday.

Headline inflation is a term that refers to overall inflation. Another measure of inflation that is preferred by economists is core inflation, which strips out food and energy because they tend to be more volatile.

A key reason for that, she said, are energy prices, which have spiked 75 cents since the beginning of 2022. Psaki cast blame on Russian President Vladimir Putin’s military buildup and subsequent invasion of Ukraine, which she said were “felt in the markets.”

Psaki added, “We also expect some increases in pandemic-affected sectors, given our strong recovery from Omicron in February. That’s a positive sign for our economy and for Americans who are going out again, traveling, going to restaurants and getting back to normal. And we also expect to see continued moderation in used car prices. So that’s what our prediction our assessment is at this point in time.”

She pointed to steps the administration is taking to ease inflationary pressures, including efforts to promote legislation to boost US competitiveness, efforts to address supply chain bottlenecks at ports and elsewhere, and steps to address shortages in the semiconductor space.

President Joe Biden on Tuesday announced his administration was banning Russian oil, natural gas and coal imports to the US in response to the Russian invasion of Ukraine, a step he warned could lead to a spike in gas prices at home.

Biden said during a trip to Texas later that day that the price of gas is “going to go up” and acknowledged he “can’t do much right now.”

Asked by reporters after deplaning Air Force One if he has a message for the American people on gas prices, Biden said, “They’re going to go up.”

“Can’t do much right now. Russia’s responsible,” Biden shouted over the loud sound of engines.

A senior administration official blamed “Putin’s choices” for gas prices in the US that are expected to keep rising.

“What we’re seeing now is a result of fears of Putin’s ongoing aggression escalating and the consequences of his actions. But we think this is a time for American resolve,” the official said.

The official declined to predict when gas prices would eventually come down.

“I can’t give you a prediction because much of what we’re seeing in energy markets is the result of Putin, his aggression and his brutal war. And I can’t get into his mind and give you a prediction on what he’ll do next, but we’re ready for anything,” the official said.

This story and its headline have been updated with additional context.

CNN’s Kate Sullivan contributed to this report.