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Inflation ticked slightly higher in October as prices remained stubbornly high for consumers, giving Federal Reserve policymakers more data to consider ahead of their meeting next month.
The Labor Department on Wednesday said that the consumer price index (CPI) – a broad measure of how much everyday goods like gasoline, groceries and rent cost – rose 0.2% in October from the prior month and was up 2.6% from a year ago.
Economists polled by LSEG predicted that inflation would come in at 0.2% in October while ticking up to 2.6% on an annual basis. The annual figure was up compared with a month ago, when the headline rate was 2.4%, while the monthly price growth was unchanged from September.
So-called core prices, which exclude more volatile measurements of gasoline and food to better assess price growth trends, were up 0.3% on a monthly basis in October and 3.3% from a year ago – both of which were unchanged compared with last month’s readings.
Consumer prices were up 2.6% in October compared with a year ago. (Justin Sullivan/Getty Images / Getty Images)
The report showed signs that inflationary pressures in the U.S. economy are persisting despite progress over the past year in bringing inflation closer to the Federal Reserve’s 2% target.
High inflation has created severe financial pressures for most U.S. households, which are forced to pay more for everyday necessities like food and rent. Price hikes are particularly for lower-income Americans, because they tend to spend more of their already-stretched paycheck on necessities and therefore have less flexibility to save money.
Over half of the rise in CPI was caused by shelter prices, which rose 0.4% in October on a monthly basis, while food prices were up 0.2% and energy prices were unchanged. Core CPI’s rise was due in part to prices for used cars and trucks rising by 2.7% compared with September.
Food prices were up 0.2% on a monthly basis and 2.1% from a year ago, though food away from home was up 3.8% in that period.
Energy prices are down 4.9% compared to a year ago, with gasoline down 12.4%. However, electricity prices are up 4% while utility gas service is up 4.5%.
Shelter prices are also up 4.9% from last year, while the cost of transportation services increased 8.2% and medical care services by 3.8% in that period. Each of those rose 0.4% on a monthly basis.