President Joe Biden and former President Donald Trump sparred during the CNN presidential debate on Thursday night over whose administration was to blame for the high inflation the U.S. economy is experiencing and when it started. "Well, let's take a look at what I was left when I became president and what Mr. Trump left me," Biden said in response to a question posed by moderator Jake Tapper that led off the debate. "We had an economy that was in freefall.
In January 2021, when President Biden took office, year-over-year inflation was 1.4%. With the economy still plagued by pandemic-related supply chain disruptions, inflation began to rise and reached 5% in May and topped 7% in December as 2021 drew to a close. The recovery of the labor market also factored into the rise of inflation, as unemployment peaked at 14.8% in April 2020 at the depth of the lockdowns but had fallen to 6.8% by October 2020.
Inflation continued to rise in 2022, with Russia's invasion of Ukraine and additional federal spending contributing to the inflationary pressures – eventually peaking at 9.1% in June 2022, a 40-year-high. Since then, inflation has subsided and totaled 3.3% in May 2024 – though that remains above the Federal Reserve's 2% target rate, which has contributed to the central bank holding interest rates at the highest level in 23 years.