US inflation rose more than expected last month
By Elisabeth Buchwald, Alicia Wallace, CNN
(CNN) — The cost of everyday necessities continued to climb in October, putting more pressure on Americans already struggling to keep up with grocery bills, housing costs and other household expenses.
Consumer prices rose 0.4% from a month earlier, more than the 0.3% increase economists had anticipated, according to data from the Bureau of Labor Statistics released Tuesday.
Nearly a third of the overall increase in prices came from shelter costs, which include rent and other housing-related expenses.
Stripping out food and energy prices, so-called “core” inflation rose 0.3%, matching the rate in September and August. The firmness in price increases beyond the pump suggests that inflation is continuing to broaden out.
No year-over-year inflation figure was available because last year’s government shutdown prevented the BLS from collecting most of the price data needed to make the comparison.
The report comes days after Democrats scored sweeping midterm victories, with frustration over the cost of living emerging as a major issue for voters.
Prices continue to rise faster than workers’ pay, meaning Americans’ earnings are losing ground to the cost of living.
Adding to the squeeze, the October inflation report all but guarantees the Federal Reserve will hike its benchmark interest rate at the December monetary policy meeting, making borrowing more expensive for households already struggling with higher costs.
Shortly before Tuesday’s data was released, Fed Governor Christopher Waller, a key voice on the central bank’s rate-setting committee, said he would be inclined to support a half-point hike next month, twice the size of the Fed’s typical move, if core inflation came in at 0.3%.
“I am particularly concerned about the breadth of price increases,” he said in remarks delivered at a Bank of England conference on Tuesday.
Stock futures moved lower and Treasury yields jumped after the hotter-than-expected report. S&P 500 futures fell 0.7%, while Nasdaq 100 futures dropped 1.35%. The 10-year yield rose to 4.93%.
This story is developing and will be updated.
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CNN’s John Towfighi contributed reporting.
