September’s CPI will be key in assessing whether inflation continues to moderate as the Federal Reserve faces tensions over the pace of rate cuts amid a surprisingly strong labor market.
The Consumer Price Index (CPI)the Twelve-month inflation in the US in September measured 2.4%slightly higher than the market’s expectations of 2.3%, but below 2.5% in Augustalthough, in the monthly measurement the consumer price index rose 0.2%, just above expectations of 0.1%.
Although it is higher than expected, the truth is that the growth of consumer prices slowed to its lowest rate since February 2021, the Department of Labor said this Thursday and noted that a trend of higher inflation continues. moderate amid a cooling but still strong labor market and higher borrowing costs.
Among the items that experienced huge price growth were food and housing. Housing costs continue to drive much of the increase in the overall index: In September, they rose 4.9% year-over-year.
The Federal Reserve minutes illustrated disputes over interest rate cuts at its last meeting and the CPI September will serve as the latest test of whether inflation will continue to slow as the Federal Reserve debates its next interest rate decision.
What the Fed will do
However, the Federal Reserve recently shifted its focus to the state of the labor market, which has been surprisingly resilient in the face of high interest rates.
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Federal Reserve
Bureau of Labor Statistics data released Friday showed the labor market added 254,000 jobs in September, more than the 150,000 expected by economists, while the unemployment rate fell to 4.1% from 4.2%.
The strong report altered expectations for the future of interest rates, with markets now forecasting a smaller 25 basis point cut in November rather than another 50 basis point cut.
“We believe it is unlikely that the Fed will not cut rates in November,” Citi economist Veronica Clark wrote in a note to clients on Monday. “Ultimately, we expect a subdued inflation environment and a reappearance of weaker labor trends in the coming months, leading officials to cut rates by 50 basis points in December, following a smaller 25-point cut. basics in November”.
Source: Ambito
I am an author and journalist who has worked in the entertainment industry for over a decade. I currently work as a news editor at a major news website, and my focus is on covering the latest trends in entertainment. I also write occasional pieces for other outlets, and have authored two books about the entertainment industry.
