Inflation was persistent in September in the United States, despite the already strong measures taken to slow it down, complicating the task of Joe Biden who, a month before the midterm elections, recently admitted the possibility of a recession.
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Prices rose 8.2% in September year on year, according to the CPI index, which refers, released Thursday by the Department of Labor. This represents a very slight slowdown since, last month, the rise in prices over one year had been 8.3%.
But it is above all the rise in prices over just one month that shows that inflation is tenacious: the rise in prices accelerated again, with +0.4% between August and September, against +0.1% between July and August. And that’s more than the 0.3% increase that was expected by analysts.
Price increases for real estate rentals, food and medical care “were the main factors contributing to the monthly increase,” the Labor Department said in a statement.
Gasoline prices at the pump, however, fell 4.9%, continuing to fall after surging due to the war in Ukraine.
So-called core inflation, which excludes volatile food and energy prices, remained stable over one month, at 0.6%, but accelerated over one year, to 6.6%.
It is even a “new high in 40 years”, notes Rubeela Farooqi, chief economist for HFE.
“Consumer prices surprised on the upside in September,” she commented.
Inflation has slowed, however, since peaking in June, when prices soared 9.1% year-on-year, the biggest rise since December 1981.
This increase in the cost of living for American households is a strong argument for opponents of Democratic President Joe Biden, one month before the mid-term elections giving rise to the renewal of some of the elected members of Congress. The slim majority of the presidential camp is at stake.
Joe Biden admitted on Tuesday that it was “possible” that the United States would experience “a very mild recession”.
Because the US central bank (Fed) is trying to slow down economic activity to ease the pressure on prices. But the longer inflation persists, the harder it must hit, at the risk of triggering a recession.
The September figures “support an aggressive monetary policy, until prices show clear signs of decelerating on a sustainable basis”, underlined Rubeela Farooqi.
Fed officials had estimated at their meeting on September 20 and 21 that a period of weaker growth and a slowdown in the job market would be necessary to overcome this inflation, the level of which they consider “unacceptable”. , according to the minutes of this meeting, published on Wednesday.
They had noted that inflation had “not yet responded” to the rate hikes intended to curb it, and had therefore undertaken a new strong increase in their main key rate, by three quarters of a percentage point.
Several of these Fed officials stressed that “acting too timidly would be more costly than acting firmly” on rates, saying that the tightening of monetary policy must continue, “despite the slowdown in the labor market “.
Globally too, the fight against high inflation is now the priority of policy makers.
This price increase affects poor and developing countries even more than developed countries. The effects of the war in Ukraine on energy and food have added to supply chain disruptions related to Covid-19.
The International Monetary Fund (IMF) has raised its global inflation forecasts for 2022 and 2023, and now expects 8.8% and 6.5% respectively, according to its latest report, released on Tuesday.
And he warned that the recession is likely to affect several developed countries in 2023, while the economies of the three world locomotives – United States, China and Europe – slow down, in particular under the effect of this persistent inflation.