Prices Continue to Rise More Than the Fed Wants

But in general, inflation continues its slow downward trend

By Newser Editors and Wire Services

Posted Oct 12, 2023 8:41 AM CDT

Copied

Prices Continue to Rise More Than the Fed Wants — A sale sign hangs below a shelf of potato chips in a Target store Wednesday, Oct. 4, 2023, in Sheridan, Colo. (AP Photo/David Zalubowski)

The latest inflation report shows that prices are still rising faster than the Federal Reserve would like, though inflation generally remains on a slow and uneven downward trajectory:

Key numbers: Prices in the US increased 0.4% from August to September, down from a faster pace the previous month, per the AP. Thursday's report from the Labor Department also showed that annual consumer inflation in September was unchanged from a 3.7% rise in August. Both figures came in slightly higher than expected, per CNBC.
Core prices: Underlying inflation declined a bit: So-called core prices, which exclude volatile food and energy costs, climbed 4.1% in September from 12 months earlier, down from a 4.3% year-over-year pace in August. That is the smallest increase in the core measure in two years, and it was in line with expectations. Core prices increased 0.3% in September, the same as the previous month.
Fed's tea leaves: Still, on a month-to-month basis, prices continue to rise faster than is consistent with the Fed's 2% target. Economists and Fed officials have long cautioned that inflation would likely ease in a bumpy and uneven way, though it is still expected to keep slowing into 2024. Thursday's inflation data follows several speeches this week by Fed officials suggesting that they are inclined to leave their benchmark interest rate unchanged at their next meeting Oct. 31- Nov. 1.
Markets: They don't seem too fazed by the report. The Dow and other major indexes opened in positive territory, though the gains were small.

(More inflation stories.)

Report an error