U.S. supplier prices have begun to slow down, signaling a possible inflation cool down in the future.
Key Details
- Inflation has been affecting people in the U.S. for months and finally signs are showing that a potential cool down could be on the way.
- U.S. supplier costs have slowed down for the second continuous month which is good news for inflation prices.
- The Producer Price Index (PPI) climbed only 8% in October compared to the same month last year. Although this number is still high it is a big difference from the 11.7% increase in March—signaling possible signs of an inflation cooling.
Why it’s news
Americans have been suffering from skyrocketing inflation prices for months forcing many families to dial back on non-essential items and save as much money as possible.
For a while there was no easing of inflation in sight, but prices are beginning to ease a little. Prices are still high, but are slowly dropping giving hope that inflation could soon slow down.
The PPI climbed only 8% in October compared to the same month last year. The prices are still rising relatively fast, but marked an easing from September’s 8.4% increase, and was down sharply from the 11.7% increase in March, the highest since records began in 2010, according to Wall Street Journal writer, Gwynn Guilford.
The Federal Reserve has been hiking interest rates in an effort to bring down inflation without starting a recession and these new inflation numbers going down might allow for the Fed to start lowering rates.
“The improvement in the October inflation data, if it persists, supports the Fed’s expectation of a step down in the pace of increases going forward,” says High Frequency Economics economist Rubeela Farooqi.
