The acceleration of inflation in the U.S., fueled in particular by a 1.3% hike in energy prices, raises concerns about the sustainability of high prices.
The Consumer Price Index (CPI) released Wednesday by the Labor Department shows that inflation increased to 0.4% in September, from 0.3% in August, while analysts expected it to remain steady.
Prices are up 5.4% over September 2020, higher than the 5.3% increase seen in August.
According to the Labor Department, “the food and housing indexes rose in September and contributed more than half of the increase” over a month. Energy prices increased 1.3 percent in September.
According to the figures, the Delta variant, is most reflected food price in grocery stores (+1,2%).
In contrast, airline ticket prices and clothing prices have decreased as well as second-hand car prices. New cars and furniture prices continue to rise due to global supply difficulties.
Increasing inflation is reigniting concerns about the sustainability of these high prices.
Assuring consumers Tuesday, Treasury Secretary Janet Yellen stated, “I think (this high level of inflation) is transitory. However, I can’t say that it will disappear in a month or two.”
The International Monetary Fund warned Tuesday that disruptions in the supply chain were holding back global economic growth. The subject will be at the center of Wednesday’s G7 Finance meeting in Washington.
In the United States, inflation peaked in June at +0.9%, the highest level since 2008, before slowing to +0.5% in July and +0.3% in August.
Another measure of inflation, the PCE index, which the U.S. Federal Reserve Bank (Fed) looks at to set its monetary policy, reported stable inflation in August over one month (+0.4%).
Globally, the IMF projects that energy prices will decline by the end of 2022. “Inflation will peak in late 2021 before stabilizing over the next few months”.