US in­fla­tion grows

The Myanmar Times - - International Business -

US in­fla­tion rose in Septem­ber at the fastest pace in five months, re­flect­ing in­creases in the prices of fuel and hous­ing.

The con­sumer price in­dex rose 0.3 per­cent for the month on a sea­son­ally ad­justed ba­sis, match­ing an­a­lyst ex­pec­ta­tions.

Over the prior 12 months, the in­dex was up 1.5pc, the largest yearly gain since Oc­to­ber 2014.

A 5.8pc rise in gaso­line prices ac­counted for more than half of the monthly in­crease. Hous­ing rose 0.4pc, the largest in­crease since May. Prices for new and used cars, com­mu­ni­ca­tions and ap­parel were down. The costs of med­i­cal care and auto in­sur­ance moved higher.

Ex­clud­ing food and fuel, where prices are more volatile, the in­dex for Septem­ber rose only 0.1pc but was up 2.2pc over 12 months.

US pol­i­cy­mak­ers have waited for signs of stronger in­fla­tion this year be­fore rais­ing in­ter­est rates, but the Fed has so far left them un­changed since De­cem­ber at 0.25 to 0.5pc.

Ian Shep­herd­son, chief econ­o­mist at Pan­theon, said the an­nual in­fla­tion fig­ure was “rocketing”.

“We ex­pect to see a 2.5pc rate by next Fe­bru­ary, by which point we think sur­veys of in­fla­tion ex­pec­ta­tions will have risen sig­nif­i­cantly,” he wrote in a client note.

How­ever, Steven Ric­chi­uto, chief econ­o­mist at Mizuho Se­cu­ri­ties USA, said that a rel­a­tively small monthly in­crease in the core in­dex, ex­clud­ing food and fuel, “sug­gests that there are still pow­er­ful de­fla­tion forces present in the goods area”.

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