High inflationary pressures in the US are easing more than expected. Inflation for goods and services fell from 8.2 percent in September to 7.7 percent in October, the Labor Department said in Washington on Thursday. Experts had expected only 8.0 percent.
Inflation continues to affect basic needs such as housing, food and gasoline. The housing index accounted for more than half of the monthly increase, showing how high rental costs remain despite the recent slowdown in the housing market. Rents rose 0.7 percent month-on-month and 7.5 percent year-on-year.
Gasoline prices rose 4 percent in September after falling for three consecutive months. Gas is also up 17.5 percent in the past year, largely as a result of Russia’s invasion of Ukraine and the West’s sanctions against a major oil producer. Other oil-exporting countries are also cutting back on production.
Economy slowed down?
It was the fourth decline in a row. The US Federal Reserve has recently braced itself against price hikes with unusually strong rate hikes, but may want to slow down a bit in the near future.
The US Federal Reserve’s key rate is currently between 3.75 and 4 percent – the Fed had recently raised interest rates for the fourth time in a row. Critics at the time feared that the economy could slow down to such an extent that the labor market and economy would stall.
Because when interest rates rise, individuals and the economy have to spend more money on loans – or they borrow less. Growth is slowing down, companies cannot simply pass on higher prices and ideally inflation will fall. However, some fear that the Fed is overdoing it – and sending the world’s largest economy into recession.
Source: Krone
I’m Wayne Wickman, a professional journalist and author for Today Times Live. My specialty is covering global news and current events, offering readers a unique perspective on the world’s most pressing issues. I’m passionate about storytelling and helping people stay informed on the goings-on of our planet.
