Inflation in the US was 7.7 percent in October and 8.2 percent in September. On a monthly basis, consumer goods prices rose 0.4 percent, which was less than expected.
Core inflation excluding food and energy rose 0.3 percent compared to September. On an annualized basis, core inflation was 6.3 percent. That too is late compared to September.
Things like medical services and used cars were cheaper in the US last month. On the other hand, housing prices are still rising sharply. Analysts expect the Fed to raise interest rates again next month, but by just 50 basis points from 75 last time.
The Dow Jones stock index reflected favorably, rising more than 800 basis points before the open, while US long-term interest rates edged lower. With lower-than-expected inflation, the U.S. central bank (Federal Reserve) may need to intervene less strongly, the reasoning goes.
Analysts expect the Fed to raise interest rates again next month, but by just 50 basis points from 75 last time.
Core inflation excluding food and energy rose 0.3 percent compared to September. On an annualized basis, core inflation was 6.3 percent. That too is late compared to September. Things like medical services and used cars were cheaper in the US last month. On the other hand, housing prices are still rising sharply. Analysts expect the Fed to raise rates again next month, but only by 50 basis points from 75 last time. Lower-than-expected inflation means the US central bank (Federal Reserve) will need to intervene less strongly. Analysts expect the central bank to raise interest rates again next month, but only by 50 basis points instead of 75 last time.
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