Cyclical|Core inflation, closely monitored by the central bank, accelerated slightly to 3.3 percent.
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Inflation in the United States slowed to 2.4 percent in September.
Economists predicted inflation to be 2.3 percent.
Core inflation, on the other hand, accelerated to 3.3 percent.
Consumer prices inflation slowed to 2.4 percent in the United States in September, the country’s Ministry of Labor said on Thursday.
Economists predicted in a survey by the Reuters news agency that the inflation rate would have been 2.3 percent. Compared to August, consumer prices rose by 0.2 percent.
In September, energy became cheaper by 6.8 percent compared to a year ago, but food became more expensive by 2.3 percent, services by 4.7 percent and housing by 4.9 percent.
The central bank and the core inflation closely monitored by economists was 3.3 percent in September, while it was 3.2 percent in August.
Core inflation is an important measure because it has removed the direct impact of sensitively changing energy and food on consumer prices. Core inflation is a better indicator of the broad scope of inflation.
“The employment data and these new inflation numbers tell us that the picture of the US economy is still unclear. I think it is likely that the central bank will continue its interest rate cuts at its next meeting in November, because it will now monitor the development of the labor market more,” says the chief analyst of the financial company Nordea Jan von Gerich.
Number of people employed outside agriculture grew in September 254,000, which was significantly more than economists’ expectations.
of the United States in mid-September, the central bank cut its key interest rate by 0.50 percentage points, which is more than usual. As a result of the decision, the interest rate range is 4.75–5.00 percent.
Based on the estimates of the members of the open market committee, which decides on the central bank’s monetary policy, it is very likely that the central bank will continue to cut interest rates this year.
Interest rate cuts have great economic significance, as the United States is the world’s largest economy. Easing monetary policy is apt to increase household consumption and business investment.
According to the central bank’s price stability objective, the inflation rate should be two percent on average over a long period of time.
“We now estimate that the central bank will lower the key interest rate by 0.25 percentage points in November. The labor market has remained surprisingly strong, and in addition, service inflation and core inflation are still fast,” says the market economist of financial group OP Jari Hännikäinen.
before after September’s interest rate cut, the central bank last cut its key interest rate in March 2020, when the coronavirus pandemic escalated and there were serious disruptions in the global economy.
Two years later, the central bank started a strong tightening of monetary policy in order to curb the accelerated inflation.
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