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Highlights
- US inflation hit a 30-year high in October, the latest Labor Department data showed.
- The US Consumer Price Index (CPI) rose at an annualized rate of 6.2% YoY in October, the highest since 1990.
- The short-term US government bond yields rose while the stock market tumbled after the data was released on Wednesday.
The US Consumer Price Index (CPI) climbed at an annualized rate of 6.2% year-over-year in October, the highest increase since 1990, the Labor Department said on Wednesday.
The CPI increased 0.9% month-on-month in October compared to a 0.4% rise in September. The index includes consumer products ranging from groceries, healthcare, gasoline to rentals, etc.
The core price index, excluding energy and food items, rose 4.6% in October from the year-ago period, the highest leap since 1991.
Gasoline prices rose 50%, while groceries increased 5.4% YoY in October. In addition, the data showed that new vehicle prices increased around 9.8%, and restaurant prices soared 5.3%.
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Source: Pixabay
Also Read: US stocks slip as inflation rises to 30-year high
What experts say
Economists said the possibility of inflation ebbing any time soon is highly unlikely, given the latest CPI data and the recent survey report of the New York Federal Reserve. The New York Fed had mapped the customer expectation for earnings and expenditure over the next year.
The high inflation will continue in short to medium term. Experts said although the stimulus checks helped maintain demand, the tight labor market pushed the consumer prices high.
Meanwhile, the inflation data has pushed the short-term US Treasury bond yields higher, raising the expectation of a higher interest rate.
Also Read: US consumer prices climb at fastest pace in 30 years
Finally, the inflationary pressures will persist as long as the global imbalance in demand and supply continues, said experts. The stock market, which remained resilient backed by strong third-quarter earnings reports, retreated on Wednesday. However, the optimism remained high amid a raft of IPOs and earnings reports due over the next few weeks.
