CPI Remained Unchanged in October as Energy Costs Cooled

Key Highlights

• Overall CPI: The Consumer Price Index (CPI-U) was unchanged in October, marking a significant slowdown from the 0.4% increase in September.
• Core Inflation: The index for all items less food and energy rose by 0.2% in October, down from 0.3% in September, representing the smallest 12-month change since September 2021, contrary to expectations of a steady rate.
• Energy and Food Prices: The energy index fell by 2.5%, with gasoline prices dropping by 5.0%. Food prices, however, continued to increase, with a 0.3% rise in October.

The October Consumer Price Index (CPI) report reveals a significant slowdown in inflation, aligning closely with economists’ predictions. The CPI for All Urban Consumers (CPI-U) remained unchanged in October after a 0.4% increase in September. This stagnation is a notable shift, reflecting the impact of decreased energy costs, particularly in gasoline prices.

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Key Influences and Variations

The primary contributing factor to the unchanged CPI was a decrease in energy costs, particularly a 5.0% decline in gasoline prices. Conversely, food prices continued their upward trend, albeit at a modest rate. The food index rose by 0.3% in October, slightly higher than September’s 0.2% increase. Core inflation, which excludes food and energy, rose by a modest 0.2%, indicating a deceleration from September’s 0.3% rise.

Long-Term Trends and Comparisons

The year-over-year analysis shows the all-items index rose by 3.2%, a decrease from September’s 3.7% rise. This is the smallest 12-month change since September 2021. Core inflation maintained a steady pace, with a 4.0% increase over the last 12 months. Additionally, the report reflects changes in the health insurance index calculation methodology, aiming to reduce data volatility and time lag.

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