Consumer price increases are beginning to ease in the U.S., not rapidly, but at a slower pace than the four-decade-high inflation boost in June.
The government’s Labor Department said Thursday that consumer prices increased at a 7.7% pace in October from the year before, down from the 8.2% annualized rate in September. On a monthly basis, prices increased four-tenths of a percentage point between September and October, matching the previous month.
The latest Consumer Price Index figure is still troubling for many U.S. shoppers facing higher prices at grocery and retail stores, as well for businesses needing supplies and raw materials for their operations. But it is lower than June’s 9.1% inflation rate that was the highest since the 1980s.
Nonetheless, inflation increases seem to have plateaued at an abnormally high level since spring 2022, with one month’s increase adding to earlier price hikes.
Policy makers at the nation’s central bank, the Federal Reserve, have rapidly increased their benchmark interest rate this year, which influences consumer borrowing rates, in hopes it will curb consumer spending. But to date the effect of the interest boosts has been minimal.
Further interest rate increases could be in the offing in the coming weeks, but some analysts fear that could push the U.S. economy, the world’s largest, into a recession.
Nearly a third of voters answering exit polls after they cast ballots in Tuesday’s nationwide congressional elections said inflation was their top concern, an issue that topped all others in the campaigns, including worries over abortion rights, crime and immigration.
Republican candidates throughout the country widely blamed Democratic President Joe Biden and his party’s candidates for the price hikes. While the cost of shopping no doubt played a role in the election, control of Congress remained in limbo Thursday, with Republicans edging toward a majority in the House of Representatives, but Senate control in doubt with undecided contests in three states.
In a statement, President Biden said the new inflation report “shows that we are making progress on bringing inflation down, without giving up all of the progress we have made on economic growth and job creation.”
But he acknowledged, “It will take time to get inflation back to normal levels—and we could see setbacks along the way—but we will keep at it and help families with the cost of living.”