July 16, 2024

Taylor Daily Press

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US inflation rose to 6.2 percent in October

Inflation in the United States rose to 6.2 percent year-on-year in October. No Pale The U.S. Consumer Price Index was released on Wednesday.

The rise in commodity prices on services in the United States was stronger than economists previously estimated. They According to the Dow Jones news agency Based on the average price increase of 5.9 percent.

Of course, inflation is currently strongly affected by higher energy prices. But with the exception of rising energy and food prices, inflation in the United States rose sharply in October, to 4.6 percent year-on-year, up from the expected 4 percent.

Rising inflation has been a setback for the US Federal Reserve. So far he says high inflation is a ‘temporary’ phenomenon.

Admittedly, in November, the Federal Reserve put a The first step to moderating a luxurious cheap monetary policy, But monetary policy in equilibrium further strengthens the flexible credit conditions for businesses and consumers.

The central bank is facing a difficult dilemma in this regard. To support the economy, the central bank has made borrowing much cheaper. At the same time, the widespread availability of ‘free money’ has pushed up the prices of goods and services.

As the central bank undertakes to keep inflation stable at 2 per cent over the medium term, the central bank should have a choice at some point.

If inflation is higher than expected in the long run, the central bank may have to raise interest rates faster than expected. This reduces investment and consumption (borrowing is more expensive), and it generally reduces inflation. But the result: slower economic growth.

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