United States: Inflation climbs to two-year high in October
November 17, 2016
In October, seasonally-adjusted consumer prices increased 0.4% from the previous month. The result came in slightly above the 0.3% increase in September and marked the fastest monthly increase in six months. October’s increase was on a par with market expectations and mainly reflected a boost in prices for energy, while food prices edged down. Inflation inched up from September’s 1.5% to 1.6% in October, the highest figure since October 2014.
Core consumer prices, which do not include food and energy prices, increased just 0.1% from the previous month, matching September’s reading and falling short of the 0.2% increase market analysts had forecast. Core inflation remained unchanged at September’s 2.2% in October.
Although the Federal Reserve targets an alternative measure of inflation called the personal consumption expenditures price index, it also follows the core inflation measure closely to judge whether inflationary pressures are increasing in the economy.
Author: Ricardo Aceves, Senior Economist