Wednesday 14th October 2020 - 13:47 (BST)
Figures released by the Bureau of Labor statistics have shown commodity prices within the US stabilised over September as more areas of the economy remain open. The Producer Price Index (PPI) for the month registered at 0.2% vs Augusts reading of 0.3% and further highlights the slowdown of inflation across the USA.
Yesterdays Consumer Price Index (CPI) showed consumer inflation rose at its slowest pace in four months, suggesting the initial shock from the coronavirus pandemic on the price of goods and services is starting to fade. Analysts were also keen to point out that most of the increase over September was tied to the biggest jump in the cost of used cars and trucks in 51 years.
The Federal Reserve will be satisfied with the latest readings following its commitment to push inflation higher and reach its 2% target level. The central bank signalled that they expect to hold interest rates near zero at least through 2023 to help achieve that goal.
The news will also be welcomed by the millions of Americans who remain unemployed as the cost of living has risen just 1.4% in the past year. The easing pressure on pinched consumers might also offer a benefit to Republican President Donald Trump’s re-election prospects against Democratic challenger Joe Biden next month.
