Major U.S. inflation indicators have seen their biggest increases since the 1990s


A U.S. inflation indicator closely watched by the Fed recorded its largest year-on-year increase since the 1990s last month, which has increased pressure on President Joe Biden as his White House is struggling to control rising costs.

The Ministry of Commerce’s core personal consumption expenditure index (excluding fluctuating food and energy costs) rose 4.1% in October compared to the same period last year.

This jump is a significant increase from the 3.7% annual growth rate in September, which is in line with consensus expectations.

If energy and food prices are included, the PCE price index has increased by 5% compared to October 2020, which is higher than the 4.4% increase in September. The data was released as part of the report, which also showed that personal income in October increased by 0.5% from the previous month, while consumption increased by 1.3%.

Fighting high prices has become the core focus of Biden’s economic team Recent data It shows that consumer price growth in the United States is growing at the fastest rate in about 30 years, frustrating people’s hope that inflationary pressures will be short-lived.

This month, the Fed began to reduce its $120 billion monthly asset purchase plan, and intends to completely end its stimulus plan next summer.

Driven by multiple rounds of stimulus checks and employers competing for new workers, inflation has accelerated this year and wages have risen. Following a 1% drop in September, revenue rose 0.5% last month.

The latest data came as US unemployment benefits fell to the lowest weekly level in 50 years on Wednesday, due to the slowdown in applications before the Thanksgiving holiday, and labor shortages that made it difficult for companies to recruit employees.

According to data from the Department of Labor, state unemployment offices received 199,000 seasonally adjusted initial jobless claims last week, down from 270,000 in the previous week. This brought the number of initial jobless claims to the lowest level since November 1969, and the previous low of 205,000 in February 2020.

The decline in initial jobless claims has also exceeded economists’ expectations, with an average of 260,000 expected this week.

“It’s fair to say that we didn’t see this happening,” said Mark Hamrick, a senior economic analyst at Bankrate.

He added: “Americans enter the center of the holiday with reasonable expectations, that is, the already tight job market will continue to tighten in the coming months.”

Some economists cautioned against over-interpreting the report, noting that the unadjusted number of initial jobless claims increased by 18,000 last week.

“The sharp decline in the number of initial jobless claims each week emits seasonally adjusted noise,” said Robert Frick, a corporate economist at the Navy Federal Credit Union. “Especially with the increase in Covid-19 cases, it seems unlikely that the average level has dropped by a factor of seven recently.”

Joshua Shapiro, chief U.S. economist at MFR, said: “This shift is due to the’expectation’ of large-scale seasonal layoffs in the construction industry as cold weather begins to envelope the northern region of the country.” “However, due to strong housing demand and weather. It hasn’t gotten better yet, and this situation hasn’t happened yet.”

As of November 13, 2 million Americans are actively receiving benefits, which is lower than the 2.1 million continuous claims recorded a week ago. Continued claims are still higher than the pre-pandemic level of approximately 1.7 million.

As employers work hard to recruit and retain existing employees, the rate of layoffs has slowed, and a record number of Americans have quit their jobs in a tight labor market.

In the past four weeks, an average of 252,000 people in the United States applied for unemployment benefits for the first time each week, down from 345,000 in early October.

Another report released by the Census Bureau on Wednesday stated that new orders for durable goods such as automobiles and kitchen appliances fell 0.5% in October from the previous month, as factories continued to struggle with parts and labor shortages. Unfulfilled durable goods orders rose 0.2%, indicating strong demand.

According to the latest news from the Bureau of Economic Analysis, the annual growth rate of the US economy in the third quarter was 2.1%, higher than the initial estimate of 2%. The revised data once again confirmed that due to supply chain bottlenecks, growth has slowed sharply this quarter.



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