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Economists anticipate cooling in Inflation as gas prices fall
(MENAFN) Economists are expecting the latest data from the federal government's Bureau of Labor Statistics, set to be released on Tuesday, to reveal a cooling in inflation for the month of October. Forecasts suggest that the consumer price index (CPI) will show a year-over-year increase of 3.3 percent, marking a notable decrease from the previous month's annual increase. This potential moderation in inflation would be particularly welcomed by policymakers and households grappling with inflation levels that have exceeded the Federal Reserve's target rate.
While inflation has seen a significant decline from its peak of around 9 percent last summer, recent months have witnessed a slowdown in the progress made in combating rapid price increases. Economists attribute the anticipated decline in October's inflation figures to a notable drop in gasoline prices, primarily driven by the transition from the busy summer travel season to a slower autumn period. According to AAA data reviewed by ABC News, gas prices fell nearly 8 percent over a four-week period starting in October.
However, analysts expect that progress in containing inflation may not be as pronounced for a key metric: core inflation. Core inflation, which excludes volatile food and energy prices, is projected to have increased by 4.1 percent in October compared to the same period last year, aligning with the rate observed in the previous month.
The release of this data comes approximately two weeks after the Federal Reserve's decision to leave interest rates unchanged. While the central bank kept the door open for a potential additional rate hike later in the year, it opted to assess the economic landscape as the impact of prior rate increases takes greater effect. The latest inflation figures will play a crucial role in shaping the ongoing discourse around monetary policy and the trajectory of the U.S. economy.
While inflation has seen a significant decline from its peak of around 9 percent last summer, recent months have witnessed a slowdown in the progress made in combating rapid price increases. Economists attribute the anticipated decline in October's inflation figures to a notable drop in gasoline prices, primarily driven by the transition from the busy summer travel season to a slower autumn period. According to AAA data reviewed by ABC News, gas prices fell nearly 8 percent over a four-week period starting in October.
However, analysts expect that progress in containing inflation may not be as pronounced for a key metric: core inflation. Core inflation, which excludes volatile food and energy prices, is projected to have increased by 4.1 percent in October compared to the same period last year, aligning with the rate observed in the previous month.
The release of this data comes approximately two weeks after the Federal Reserve's decision to leave interest rates unchanged. While the central bank kept the door open for a potential additional rate hike later in the year, it opted to assess the economic landscape as the impact of prior rate increases takes greater effect. The latest inflation figures will play a crucial role in shaping the ongoing discourse around monetary policy and the trajectory of the U.S. economy.
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