Thursday, December 02, 2021 | Rabi' ath-thani 26, 1443 H
clear sky
weather
OMAN
21°C / 21°C
EDITOR IN CHIEF- ABDULLAH BIN SALIM AL SHUEILI

US consumer prices rise solidly in November
1393968
1393968

WASHINGTON: US consumer prices increased solidly in November, which together with labour market strength could support the Federal Reserve’s intention to keep interest rates steady indefinitely after reducing borrowing costs three times this year.


The report from the Labour Department on Wednesday also showed underlying inflation firming last month.


The US central bank held rates unchanged on Wednesday amid expectations the economy will continue to grow moderately next year and unemployment remain low. The Fed again signalled a pause in the easing cycle that started in July when it cut rates for the first time since 2008.


“There are no worrisome deflation undercurrents in this economy and Fed officials do not need to cut interest rates further to boost economic demand,” said Chris Rupkey, chief economist at MUFG in New York.


The consumer price index rose 0.3 per cent last month as households paid more for gasoline and electricity, and food prices increased for a third consecutive month. The CPI advanced 0.4 per cent in October. In the 12 months through November, the CPI shot up 2.1 per cent after gaining 1.8 per cent in October.


Economists polled by Reuters had forecast the CPI climbing 0.2 per cent in November and rising 2.0 per cent on a year-on-year basis.


Excluding the volatile food and energy components, the CPI rose by 0.2 per cent, matching October’s increase. The so-called core CPI was up by an unrounded 0.2298 per cent last month compared to 0.1572 per cent in October. The core CPI was lifted by gains in healthcare and prices of used cars and trucks, recreation and hotel and motel accommodation. In the 12 months through November, the core CPI increased 2.3 per cent after a similar gain in October.


The Fed tracks the core personal consumption expenditures (PCE) price index for its 2.0 per cent inflation target, which is lagging other inflation measures. The core PCE price index rose 1.6 per cent on a year-on-year basis in October and has undershot its target this year. November PCE price data will be published later this month.


The wide gap between the core PCE price index and core CPI exists because housing and healthcare have different weightings in each inflation measure. Even with the CPI perking up, the outlook for inflation remains benign.


In a separate report on Tuesday, the Atlanta Fed said its sticky-price consumer price index (CPI), a weighted basket of items that change price relatively slowly, rose 2.6 per cent on an annualised basis in November after increasing 3.3 per cent in October. It was up 2.8 per cent year-on-year in November. — Reuters


SHARE ARTICLE
Most Read
The UK, Japan and Singapore are among those rushing in stricter quarantine measures or banning flights from South Africa, Lesotho, Botswana, Zimbabwe,Mozambique, Namibia and Eswatini.
Countries shuts borders over new Covid variant Fuel prices for December announced in Oman Alert: Heavy rains likely in coming hours Air Bubble to continue as India extends ban on international flights
FOLLOW US
arrow up
home icon