Trump’s inflation jumps to 3.7% as gas and diesel prices squeeze consumers ahead of the midterms
NBCNews.com reports:
By By Steve Kopack
BLUF: Friday’s number is the final inflation report before November’s pivotal midterm elections, where business owners and consumers have said they will be voting with their bottom line in mind.
Inflation in September picked back up again after three months of largely stagnating. Overall, prices rose 3.7% from a year ago, and 0.6% from August.
The increase was slightly more than had been expected by economists polled by Dow Jones, which had forecast a jump to 3.6%.
“The index for gasoline rose 9.1 percent in September, accounting for over half of the monthly all items increase,” the Bureau of Labor Statistics said in its report. Other categories where prices increased were housing, clothes and restaurant and take out food.
Only three categories saw price declines: groceries, medical care commodities, and utility gas service.
Friday’s number is the final inflation report before November’s pivotal midterm elections, where business owners and consumers have said they will be voting with their bottom lines in mind.
Since August, oil prices have risen to more than $106 per barrel from about $80. The price of unleaded gas, which most consumers use, has risen 45% since late February, when the Iran war was launched. The price of diesel, which powers businesses, farms, the shipping industry and other critical sectors, has soared 70% over the same period.
As early voting kicks off this week, the data also comes at a precarious moment for Republicans defending majorities in the House and the Senate. Polls consistently find that inflation and the high cost of living are top issues this year for voters in both parties.
Meanwhile, wage growth has been stagnant for workers. As of September, the growth in wages was pacing at 3% on an annual basis. Paychecks have not grown faster than inflation since March.
Core inflation, which excludes food and energy prices, also rose to 2.6% from a year ago, or 0.3% from August. This was also slightly more than had been expected.
Stock futures fell sharply in response to the readings, as traders reassessed the potential for another Federal Reserve interest rate hike in October.
Before Wednesday’s data, market odds showed that traders had expected the central bank to wait until December to raise rates.
The prospect of a rate hike also helped send bond yields higher, which will in turn raise consumer borrowing costs, especially for mortgages.
A Fed hike could add even more pressure to consumers, raising the cost of other forms of credit like cards, personal loans and vehicle loans.
By By Steve Kopack
BLUF: Friday’s number is the final inflation report before November’s pivotal midterm elections, where business owners and consumers have said they will be voting with their bottom line in mind.
Inflation in September picked back up again after three months of largely stagnating. Overall, prices rose 3.7% from a year ago, and 0.6% from August.
The increase was slightly more than had been expected by economists polled by Dow Jones, which had forecast a jump to 3.6%.
“The index for gasoline rose 9.1 percent in September, accounting for over half of the monthly all items increase,” the Bureau of Labor Statistics said in its report. Other categories where prices increased were housing, clothes and restaurant and take out food.
Only three categories saw price declines: groceries, medical care commodities, and utility gas service.
Friday’s number is the final inflation report before November’s pivotal midterm elections, where business owners and consumers have said they will be voting with their bottom lines in mind.
Since August, oil prices have risen to more than $106 per barrel from about $80. The price of unleaded gas, which most consumers use, has risen 45% since late February, when the Iran war was launched. The price of diesel, which powers businesses, farms, the shipping industry and other critical sectors, has soared 70% over the same period.
As early voting kicks off this week, the data also comes at a precarious moment for Republicans defending majorities in the House and the Senate. Polls consistently find that inflation and the high cost of living are top issues this year for voters in both parties.
Meanwhile, wage growth has been stagnant for workers. As of September, the growth in wages was pacing at 3% on an annual basis. Paychecks have not grown faster than inflation since March.
Core inflation, which excludes food and energy prices, also rose to 2.6% from a year ago, or 0.3% from August. This was also slightly more than had been expected.
Stock futures fell sharply in response to the readings, as traders reassessed the potential for another Federal Reserve interest rate hike in October.
Before Wednesday’s data, market odds showed that traders had expected the central bank to wait until December to raise rates.
The prospect of a rate hike also helped send bond yields higher, which will in turn raise consumer borrowing costs, especially for mortgages.
A Fed hike could add even more pressure to consumers, raising the cost of other forms of credit like cards, personal loans and vehicle loans.
