United States Inflation October 2020

United States

United States: Inflation declines to lowest level since July in October

November 12, 2020

Consumer prices increased a seasonally-adjusted 0.04% in October over the previous month, coming in below September's 0.20% increase. October's result marked the softest reading since May. Looking at the details of the release, prices for housing increased at a faster rate in October. In contrast, prices for transportation increased at a slower rate. Meanwhile, food prices accelerated.

Inflation fell to 1.2% in October, easing slightly from September’s 1.4%. October's reading represented the weakest inflation rate since July. Annual average inflation remained at September's 1.4% in October. Lastly, core inflation edged down to 1.6% from the previous month's 1.7%. The core personal consumption expenditures price index—a gauge of household spending closely tracked by the Fed—accelerated to 1.4% in September, the latest month for which data is available. This was up from 1.3% in August and moved slightly closer to the Fed’s 2.0% target.

FocusEconomics Consensus Forecast participants expect inflation to average 1.9% in 2021, which is up 0.1 percentage points from last month’s forecast. For 2022, the panel expects inflation to average 1.9%.


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United States Inflation Chart

United States Inflation October 20 20 0

Note: Year-on-year and month-on-month variation of seasonally-adjusted consumer price index in %.
Source: Bureau of Labor Statistics.

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