- Mar 25, 2017
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Price increases moderated in the United States last 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.
Consumer inflation reached 7.7 percent in October from a year earlier and 0.4 percent from September, the Labor Department said Thursday. The year-over-year gain was the smallest since January. Excluding volatile food and energy prices, “core” inflation rose 6.3 percent in the past 12 months and 0.3 percent from September.
The numbers were all lower than economists had expected.
Even before Thursday’s figures, inflation by some measures had begun to ease and could continue to do so in coming months. Most gauges of workers’ 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.
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 Los Angeles and Long Beach has been cleared.
Even as many fear that the economy will fall into recession next year, the nation’s 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 percent, close to a half-century low. Job openings are still at historically high levels.
And economists expect to see prices decline for many key goods. Used cars, which skyrocketed in price last year as shortages of computer chips sharply reduced the availability of new cars, are expected to have fallen from September to October. Wholesale used-car costs have declined steadily but have yet to show fully show up in retail prices.
U.S. consumer inflation eased to 7.7 percent over past 12 months
Consumer inflation reached 7.7 percent in October from a year earlier and 0.4 percent from September, the Labor Department said Thursday. The year-over-year gain was the smallest since January. Excluding volatile food and energy prices, “core” inflation rose 6.3 percent in the past 12 months and 0.3 percent from September.
The numbers were all lower than economists had expected.
Even before Thursday’s figures, inflation by some measures had begun to ease and could continue to do so in coming months. Most gauges of workers’ 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.
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 Los Angeles and Long Beach has been cleared.
Even as many fear that the economy will fall into recession next year, the nation’s 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 percent, close to a half-century low. Job openings are still at historically high levels.
And economists expect to see prices decline for many key goods. Used cars, which skyrocketed in price last year as shortages of computer chips sharply reduced the availability of new cars, are expected to have fallen from September to October. Wholesale used-car costs have declined steadily but have yet to show fully show up in retail prices.
U.S. consumer inflation eased to 7.7 percent over past 12 months
