{"id":7291,"date":"2022-11-10T15:07:04","date_gmt":"2022-11-10T21:07:04","guid":{"rendered":"https:\/\/nwfl4sale.com\/consumer-inflation-eased-to-7-7-in-past-12-months\/"},"modified":"2022-11-10T15:07:04","modified_gmt":"2022-11-10T21:07:04","slug":"consumer-inflation-eased-to-7-7-in-past-12-months","status":"publish","type":"post","link":"https:\/\/nwfl4sale.com\/consumer-inflation-eased-to-7-7-in-past-12-months\/","title":{"rendered":"Consumer Inflation Eased to 7.7% in Past 12 Months"},"content":{"rendered":"
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That\u2019s the smallest rise since Jan. It\u2019s also down 0.4% from Sept. And core inflation, which excludes food and energy, rose 6.3% in past 12 months, down 0.3% from Sept.<\/span><\/span><\/span><\/p>\n<\/div>\n WASHINGTON (AP) \u2013 Price increases moderated in\u00a0the United States\u00a0last month in the latest sign that the inflation pressures that have gripped the nation might be easing as the economy slows and consumers grow more cautious.<\/span><\/span><\/span><\/p>\n Consumer inflation reached 7.7% in October from a year earlier and 0.4% from September, the government said Thursday. The year-over-year increase, a slowdown from 8.2% in September, was the smallest rise since January. A separate gauge called core inflation, which excludes volatile food and energy, rose 6.3% in the past 12 months and 0.3% from September.<\/span><\/span><\/span><\/p>\n The numbers were all lower than economists had expected.<\/span><\/span><\/span><\/p>\n Helping drive the inflation slowdown from September to October were used car prices, which dropped for a fourth straight month. Also down were the prices of clothing and medical care. Food price increases slowed. By contrast, energy prices rebounded in October after having declined in August and September.<\/span><\/span><\/span><\/p>\n Even with last month\u2019s tentative easing of inflation, the\u00a0Federal Reserve\u00a0is widely expected to keep raising interest rates to try to stem persistently high price increases. But Thursday\u2019s better-than-expected data raised the possibility that the Fed could decide to slow its rate hikes \u2013 a prospect that sent stock prices jumping immediately after the government issued the figures.<\/span><\/span><\/span><\/p>\n \u201cWe expect this to mark the start of a much longer disinflationary trend that we think will convince the Fed to halt its (hikes) early next year,\u201d said\u00a0Paul Ashworth, chief North American economist at Capital Economics, a consulting firm. \u201cWith supply shortages normalizing, deflationary pressure is now finally showing up.\u201d<\/span><\/span><\/span><\/p>\n Many economists have warned that in continuing to tighten credit, the central bank is likely to cause a recession by next year. So far this year, the Fed has raised its benchmark interest rate six times in sizable increments, heightening the risk that prohibitively high borrowing rates \u2013 for\u00a0mortgages, auto purchases and other high-cost expenses \u2013 will tip the world\u2019s largest economy into recession.<\/span><\/span><\/span><\/p>\n Some economists suggested that the latest inflation data shows that the hikes are beginning to achieve their goal, though the Fed needs to see further evidence.<\/span><\/span><\/span><\/p>\n \u201cThe data will be welcome news for the (Fed), finally showing some response in prices\u201d to the rate increases, said Rubeela Farooqi, chief\u00a0U.S.\u00a0economist at High Frequency Economics.<\/span><\/span><\/span><\/p>\n In the midterm elections that ended Tuesday, nearly half of voters cited inflation as their top concern, according to VoteCast, an extensive survey of more than 94,000 voters nationwide conducted for The Associated Press by NORC at the\u00a0University of Chicago. About 8 in 10 said the economy was in bad shape, and a slim majority blamed President Joe Biden\u2019s policies for worsening inflation. Just under half said factors beyond Biden\u2019s control, such as Russia\u2019s invasion of\u00a0Ukraine, were to blame.<\/span><\/span><\/span><\/p>\n Those economic anxieties contributed to the loss of Democratic seats in the\u00a0House of Representatives, though\u00a0Republicans\u00a0failed to score the huge political gains that many had expected. And a sizable chunk of voters \u2013 44%, according to VoteCast \u2013 said their top concern was the future of democracy, an issue that was emphasized by Biden and Democratic congressional candidates.<\/span><\/span><\/span><\/p>\n Even before the release of Thursday\u2019s figures, inflation by some measures had begun to ease and could continue to do so in coming months. Most gauges of workers\u2019 wages, for example, show that the robust pay increases of the past 18 months have leveled off and have begun to fall. Though worker pay is not a primary driver of higher prices, it can compound inflationary pressures if companies offset their higher labor costs by charging their customers more.<\/span><\/span><\/span><\/p>\n Except for automakers, which are still struggling to acquire the computer chips they need, supply chain disruptions have largely unsnarled. Shipping costs have dropped back to pre-pandemic levels. The backup of cargo ships off the port of\u00a0Los Angeles\u00a0and\u00a0Long Beach\u00a0has been cleared.<\/span><\/span><\/span><\/p>\n And as declines in new rents that have emerged in real-time measures from such sources as ApartmentList and Zillow begin to be captured in the government\u2019s forthcoming measures, that factor should also reduce inflation.<\/span><\/span><\/span><\/p>\n Even as many fear that the economy will fall into recession next year, the nation\u2019s job market has remained resilient. Employers have added a healthy average of 407,000 jobs a month, and the unemployment rate is just 3.7%, close to a half-century low. Job openings are still at historically high levels.<\/span><\/span><\/span><\/p>\n But the Fed\u2019s rate hikes have inflicted severe damage on the American housing market. The average rate on a 30-year fixed\u00a0mortgage\u00a0has more than doubled over the past year, topping 7% before falling slightly last week. As a result, investment in housing collapsed in the July-September quarter, falling at a 26% annual rate.<\/span><\/span><\/span><\/p>\n Higher\u00a0mortgage\u00a0rates have depressed sales. Home prices are slowing sharply compared with a year ago and have begun to fall on a monthly basis. The cost of a new apartment lease is also declining.<\/span><\/span><\/span><\/p>\n Copyright \u00a9 2022 The Associated Press, Paul Wiseman, AP economics writer, with AP economics writer Christopher Rugaber contributing to this report. All rights reserved.<\/span><\/span><\/span><\/p>\n<\/div><\/div>\n <\/p>\n <\/p>\n