Data released on Tuesday showed annual inflation in the US rose to 1.4% in September from 1.3%. Analysts at Wells Fargo point out the 0.2% gain in September of the CPI was the smallest gain since price fell in May. They explained core prices increased 0.2%, as a 0.8% rise in goods prices offset a notable slowdown in services tied largely to housing.
Key Quotes:
“After sizeable swings over the course of the pandemic, consumer prices rose a run-of-the-mill 0.2% in September. But underneath the surface, pandemic effects still loom large.”
“Prices for core services remain under pressure, however. Ex-food and energy, prices were flat on the month, with shelter costs again barely ticking up (+0.1%) and a drop in airfare and motor vehicle insurance holding down transport service costs.
“We expect inflation to climb higher over the remainder of the year, but to remain below its pre-pandemic trend as the demand backdrop remains generally weak, especially for services.”
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