(Washington) Inflation remained stable over a year in September in the United States, prices having once again been driven by housing and gasoline at the pump, but it slowed down over a month, for the first time since May, bringing a touch of optimism.
The increase in prices remained at 3.7% over one year, according to the CPI index published Thursday by the Labor Department, disappointing analysts, who were counting on a slight slowdown, to 3.6% over one year, according to the MarketWatch consensus.
Over just one month, however, inflation slowed for the first time since May, and stood at 0.4%, compared to 0.6% in August.
After reaching its highest level in more than 40 years in June 2022, inflation had slowed every month until last July. It then started to rise again, driven by housing prices, then, in August, by the price of gasoline at the pump.
If we exclude food and energy prices, which are more volatile, so-called core inflation slows down in September year-on-year, to 4.1%, and is stable over one month, at 0. 3%.
Gradual improvement
“Rates remain high, but overall show a gradual improvement,” commented Rubeela Farooqi, chief economist for HFE.
According to her, this argues “in favor of an absence of rate increases at the next meeting” of the American central bank (Fed), on October 31 and 1er november.
It is in fact up to the Fed to bring down inflation, and it wants to bring it back to around 2%. To do this, it has raised its main key rate 11 times since March 2022. But during its last meeting, at the end of September, it was maintained in the range of 5.25 to 5.50%.
For Fed officials, the question now is no longer how high rates will rise, but how long they will stay at this level – the highest in more than 20 years – the account revealed on Wednesday. -report of this meeting.
Several of them have, in recent days, recalled that rates could be raised further, in the face of inflation that is still too high, and that the solidity of the American economy would allow it to absorb this tightening without falling into recession. .
Two regional Fed chairs also said tighter monetary conditions caused by rising Treasury yields could have a similar effect.
“Passing on inflation”
“I can’t pass on inflation […] up to what it costs me,” Jennifer Haesley, manager of Sweet Mama’s Mambo Sauce, a small business she created in 2017, recently explained.
The price of a bottle of sauce “has been the same since I have been in business”, but this “will have to change in 2024”, she explained to AFP on October 2, from the York market (Philadelphia), just before a visit from the chairman of the Fed.
“I will have to increase costs because the bottles have increased, the labels have increased,” explained M.me Haesley, but also two of its basic ingredients, tomatoes and peppers, which “increased by 50%”.
Its margin, previously around 65% per bottle, is now only around 45%, she points out.
Another measure of rising prices on the consumer side, the PCE index, favored by the Fed, will be published later in the month.
On the producer side, the PPI index, published Wednesday for September, slowed down over one month, to 0.5%, but continued to accelerate over one year to 2.2%, climbing to its highest level since April, because of gas prices.