2023-10-12 14:10:10
(Washington) Inflation remained stable over a year in September in the United States, prices having once again been driven by housing and gasoline at the pump, but it slowed down over a month, for the first time since May, bringing a touch of optimism.
The increase in prices remained at 3.7% over one year, according to the CPI index published Thursday by the Labor Department, disappointing analysts, who were counting on a slight slowdown, to 3.6% over one year, according to the MarketWatch consensus.
But other figures are more encouraging. Thus, over just one month, inflation slowed for the first time since May, and stood at 0.4%, compared to 0.6% in August.
Furthermore, so-called core inflation, which excludes food and energy prices, slowed: it fell to 4.1%, its lowest level in two years. It is stable over one month, at 0.3%.
President Joe Biden once again highlighted his economic policy, nicknamed “Bidenomics”, to explain these figures.
“Inflation is down 60% compared to its peak” of 9.1% in June 2022, the highest in more than 40 years, “this is Bidenomics in action”, he assured in A press release.
Gradual improvement
The Nobel Prize winner in economics, Paul Krugman, declared victory: “the war against inflation is over. We won, and the price was low,” according to a post on the social network X (formerly Twitter).
Inflation had slowed from the summer of 2022, but started to rise again last July, driven by housing prices, then in August, because of gasoline prices at the pump.
The level of inflation “remains high, but overall shows a gradual improvement,” commented Rubeela Farooqi, chief economist for HFE.
According to her, this argues “in favor of an absence of an increase in key rates at the next meeting” of the American central bank (Fed), on October 31 and 1is November.
It is indeed up to the Fed to bring down inflation, and it wants to bring it back to around 2%. To do this, it has raised its main key rate 11 times since March 2022. But during its last meeting, at the end of September, it was maintained in the range of 5.25 to 5.50%.
For Fed officials, the question now is no longer how high rates will rise, but how long they will stay at this level – the highest in more than 20 years – the account revealed on Wednesday. -report of this meeting.
Several members of the Fed have, in recent days, recalled that rates could be raised further, in the face of inflation that is still too high, and that the solidity of the American economy would allow it to absorb this tightening without falling into recession. .
Two regional Fed chairs also said tighter monetary conditions caused by rising Treasury yields could have an effect similar to a rate hike.
“Passing on inflation”
“I can’t pass on inflation […] up to what it costs me,” Jennifer Haesley, manager of Sweet Mama’s Mambo Sauce, a small business she created in 2017, recently explained.
The price of a bottle of sauce “has been the same since I have been in business”, but this “will have to change in 2024”, she explained to AFP on October 2, from the York market (Philadelphia), just before a visit from the chairman of the Fed.
“I will have to increase costs because the bottles have increased, the labels have increased,” explained M.me Haesley, but also two of its basic ingredients, tomatoes and peppers, which “increased by 50%”.
Its margin, previously around 65% per bottle, is now only around 45%, she points out.
Another measure of rising prices on the consumer side, the PCE index, favored by the Fed, will be published later in the month.
On the producer side, the PPI index, published Wednesday for September, slowed down over one month, to 0.5%, but continued to accelerate over one year to 2.2%, its highest level since April.
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