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U.S. consumer prices rise less than expected in October

Time:2022-11-11 10:15:00 Source: XINHUA China Youth International

  WASHINGTON, Nov. 10 (Xinhua) -- The U.S. consumer price index (CPI), a widely watched inflation indicator, cooled somewhat in October, sending U.S. markets surging.

  The index climbed less than expected, signaling that while inflation remains a major economic threat, it might start receding.

  The index -- a broad measure of the cost of goods and services -- rose 0.4 percent for October and 7.7 percent from a year ago, according to data released Thursday from the Bureau of Labor Statistics.

  That was lower than Dow Jones estimates, which had predicted increases of 0.6 percent and 7.9 percent, respectively.

  Excluding the costs of energy and food, the so-called core CPI rose 0.3 percent for October and 6.3 from the same time last year.

  One aspect that helped tamp down inflation numbers was a 2.4 percent drop in the price of used vehicles. Prices in the apparel sector declined 0.7 percent and medical care services dropped 0.6 percent.

  "There is something very key here with regard to today's improvement in used car prices; it confirms what some of the important indicators have been telling us recently: that inflation has begun to moderate from the extreme levels of the past few months," according to Rick Rieder, BlackRock's chief investment officer of global fixed income, as quoted by CNBC.

  Markets reacted strongly to the numbers, with the Dow Jones Industrial Average surging over 1,100 points during afternoon trading.

  That came at a time of market decline over the past several months, with jittery investors expressing concern over inflation, as well as the U.S. Federal Reserve's several rate hikes - a bid to take control over surging prices.


  A trader works on the floor of the New York Stock Exchange (NYSE) in New York, the United States, Oct. 7, 2022.  (Photo by Michael Nagle/Xinhua) 

  U.S. markets have seen several sell-offs in recent months, and the day's market increase stood out as a major relief to many investors.

  "The trend in inflation is a welcome development, so that's great news in terms of the report," Michael Arone, chief investment strategist at State Street Global Advisors, was quoted by CNBC.

  "However, investors are still gullible... So I think this morning's enthusiasm is a bit of an overreaction," Arone said.

  Still, even with Thursday's positive developments, U.S. inflation remains at a 40-year-high and is far above the U.S. Federal Reserve's official target of 2 percent.

  Indeed, Americans continue to feel the sting of an increased cost of living.

  The cost of shelter, which comprises around a third of CPI, grew 0.8 percent for October - the greatest monthly gain since 1990. It rose 6.9 percent from the same period last year - the highest level since 1982.

  Fuel oil prices grew a whopping 19.8 percent higher for the month and ticked upward 68.5 percent from the same time last year.

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