- US inflation rate fell to 2.4% in September, supported by declining energy prices.
- Despite lower inflation, recent labor market data, including increased unemployment claims, highlight potential risks to economic stability.
The inflation rate in the United States showed slight relief in September, which at first glance could be interpreted as a success of the monetary policies implemented by the US central bank. The inflation rate fell to 2.4%, below market expectations. A significant factor in this development was the 1.9% decrease in energy prices.
This decrease directly impacts the overall inflation rate, as energy costs are a significant component of consumer prices.
However, it is important not to overlook that other price sectors continue to exert pressure on the price level. Notably, food prices increased by 0.4% and housing costs rose by 0.2%. These developments are particularly relevant because the core inflation rate, which excludes more volatile elements like energy and food, remains at 3.3%.
This suggests that underlying inflationary pressures in the economic system are still strong and potentially more challenging to control.
The price dynamics reveal that despite the apparent easing of inflation, some price drivers remain persistent. Increasing costs in sectors such as healthcare and apparel, with price increases of 0.7% and 1.1%, respectively, highlight the complex structure of inflation dynamics. Additionally, it is important to consider that a significant portion of inflation calculations is based on housing costs, which, although they have decreased by 4.9% over the year, are still higher than expected.
As inflation appears to stabilize, the labor market is experiencing setbacks. The number of unemployment claims reached 258,000 in the first week of October, a surprising increase compared to previous weeks. Factors contributing to this include the dual impact of Hurricane Helene and the strike by Boeing workers.
These events have significantly affected certain states, particularly Florida and Michigan, where unemployment numbers have surged dramatically.
This raises doubts about the short-term strength of the American economy. Upon closer examination, experts wonder if this fragility could slow down the next interest rate cuts planned by the Federal Reserve. To recall, a decrease of 50 basis points was observed at the beginning of September.
While monetary policy seems to positively influence inflation, it is becoming increasingly clear that other aspects of the economy, such as consumption, could be affected. Prices for used cars and healthcare continue to rise, and household spending, though less volatile than energy or food, could be restrained by rising unemployment.
