The inflation rate in the United States has risen to its highest level in three years, coinciding with the escalating repercussions of the war with Iran and rising energy and food prices, while new data revealed that American household debts have reached a record level of $18.8 trillion, increasing economic pressures on millions of Americans.
Consumer price index data released by the U.S. Bureau of Labor Statistics on Tuesday showed that annual inflation reached 3.8 percent in April, exceeding economists' expectations of 3.7 percent, driven by a rise in energy prices of about 18 percent compared to the same period last year.
Food prices have also seen significant increases, particularly for meat, eggs, vegetables, and dairy products, at a time when economists say that rising living costs have outpaced monthly wage growth rates, meaning that American families are beginning to lose their ability to keep up with basic expenses.
University of Michigan economist Justin Wolfers said that US President Donald Trump campaigned promising to lower the cost of living “from day one,” but instead “started a trade war, expanded deportations, bombed Iran, cut food aid, and attacked the independence of the Federal Reserve.”
In the same context, data from the Federal Reserve Bank of New York showed that US household debt rose by $18 billion during the first quarter of this year, reaching $18.8 trillion, driven by an increase in housing and auto loans and mortgage credit lines.
According to the data, mortgage loans rose to $13.19 trillion, while auto loans reached $1.69 trillion, and the default rate on student loans exceeded 10 percent.
Economic reports indicate that more than half of Americans rely on credit cards to cover basic needs such as food, housing, and services, while 57 percent of borrowers said they need six months or more to pay off their credit card debt.
Politicians and experts accused the Trump administration of exacerbating the economic crisis, arguing that the war with Iran raised global fuel prices after the disruption of shipping traffic in the Strait of Hormuz , which led to an increase in gasoline prices within the United States to more than $4.50 per gallon.
In remarks that sparked controversy, Trump said he does not think about the financial situation of Americans when he talks about Iran, adding that "the only thing that matters is that Iran does not have a nuclear weapon."
A new CNN poll also showed that 70 percent of Americans disapprove of Trump's handling of the economy, while 75 percent said the war with Iran has negatively affected their financial situation.
Economists believe that the continuation of the war and rising prices could push the US economy into a more difficult phase during the second half of the year, with increasing fears of declining household purchasing power and a widening cost-of-living crisis.
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