Prices held steady in October as inflation slowed further
October saw no major changes in prices, as inflation continued to slow and the overall economy remained stable. Consumer prices were up by 0.2% in October, slightly lower than the 0.3% increase seen in September, and below analysts’ expectations. The subdued price growth was primarily driven by lower energy prices, which fell by 0.4%, and food prices, which rose by just 0.1%. Core inflation, which excludes volatile food and energy prices, was unchanged from September’s reading.
The overall stability in prices provides a welcome respite for households and businesses, but could cause some concern among policymakers as it could suggest that the economic recovery is fragile. As such, the Federal Reserve is expected to keep interest rates at their current level for the foreseeable future.