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US Inflation Pressures Further Increases In September

By 10/13/2022 4:20 PMNo CommentsBy YidInfo Staff

In September, the cost of housing and other needs increased pressure on households, wiping out pay raises for many workers and ensuring that the Federal Reserve would continue aggressively hiking interest rates.

On the same month, the government reported on Thursday that consumer prices increased 8.2% over the same month last year.

Prices rose 0.4% from August to September every month after increasing 0.1% from July to August.

Core inflation, measured without the erratic categories of food and energy, increased last month, indicating that the Fed’s five rate increases this year have not yet impacted reducing inflation pressures.

From August to September, core inflation rose by 0.6% and 6.6% from one year earlier.

The annual core figure has increased by the most in 40 years. Core prices often provide a clearer picture of underlying price patterns.

The Dow Jones Industrial Average futures moved from a drop of several hundred points to 400 points in a matter of seconds as major U.S. markets abruptly swung lower.

Additionally, European markets fell.

After a campaign season in which skyrocketing prices have increased public fear, with many Republicans blaming President Joe Biden and congressional Democrats, Thursday’s report represents the final U.S. inflation figures before the Nov. 8 midterm elections.

The cost of numerous services increased last month, including housing, auto repair, and health care.

For instance, the price of glasses and eye care increased by 3.2% from August to September, the most significant monthly increase ever.

The main drivers of service inflation include stable consumer demand and rising labor costs.

For instance, this week saw significant revenue and profit growth recorded by American Airlines and Delta, thanks to rising traveler demand.

From August to September, airline prices increased sharply (0.8%).

To recruit the people they require, various service sectors, including airlines, hospitals, and even veterinary services, are forced to raise wages quickly.

Consumers frequently pay a higher price due to these more significant labor expenditures.

Despite solid job growth and historically low unemployment, inflation has increased families’ prices for groceries, rent, and utilities, among other things.

This has made life difficult for many people and deepened their pessimism about the economy.

Prices are rising even as some supply chain issues plaguing many manufacturers are improving.

Last month, core goods prices, which drove inflation higher than the previous year, remained constant.

According to a recent study by The Associated Press-NORC Center for Public Affairs Research, Americans are becoming more pessimistic about their financial situation as the midterms approach.

Approximately 46% of Americans, up from 37% in March, say their financial position is poor. Contrast that significant decline with the measurements that had mainly remained constant during the outbreak.

The Fed’s plans to maintain raising rates quickly to bring inflation under control are not likely to be altered by the September inflation figures.

Since March, the Federal Reserve has increased its short-term benchmark rate by three percentage points, the quickest rate of increase since the early 1980s.

These price hikes increase borrowing costs for a business, vehicle, and home loan and lower inflation.

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