ROUNDUP: US inflation eases slightly as core rate rises to 40-year high | news

ROUNDUP: US inflation eases slightly as core rate rises to 40-year high |  news

WASHINGTON (dpa-AFX) – The high inflation in the USA is tending to recede, but it is only falling slightly. Compared to the same month last year, consumer prices rose by 8.2 percent in September, the Department of Labor announced in Washington on Thursday. Analysts had expected an average rate of 8.1 percent. In August, the inflation rate was 8.3 percent.

Core inflation, which excludes volatile energy and food prices, even rose from 6.3 to 6.6 percent. This is the highest level in 40 years. According to the ministry, headline inflation was most clearly driven by rents, groceries and medical supplies. In particular, the significant rise in rents has been causing economists headaches for some time, as they affect many households and make up a good 30 percent of the basket against which the inflation rate is measured.

The US dollar gained across the board after the numbers. US government bond yields also rose. Because the high rise in prices points to further strong interest rate hikes by the US Federal Reserve, which has already increased its key interest rate by three percentage points in the current year. With this tight course, she wants to brace herself against the high inflation.

“The air is only slowly escaping from the inflation balloon,” commented Thomas Gitzel, chief economist at VP Bank. The persistently high inflation suggests that the Fed will raise its key interest rates again by 0.75 percentage points at the next meeting in early November. It would be the fourth tightening of this magnitude in a row. Markets are expecting the Fed to raise interest rates from around 3% to around 4.5% in the coming months. He should then stay there for a long time./bgf/jkr/nas

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