U.S. Consumer Prices Register Biggest Drop in 8 Months

In the U.S., the stock market remains elevated, the official September unemployment rate was 5.0% and jobless claims just touched a 42-year low.

Yet, inflation remains subdued.

In September, U.S. consumer prices recorded their biggest decline in 8 months.

Here are some details from an Oct. 15 CNBC article:

The Labor Department said on Oct. 15 its Consumer Price Index fell 0.2 percent last month after slipping 0.1 percent in August. In the 12 months through September, the CPI was unchanged for the first time in four months after rising 0.2 percent in August.

Economists polled by Reuters had forecast the CPI falling 0.2 percent in September and dipping 0.1 percent from a year ago. The so-called core CPI, which strips out food and energy costs, rose 0.2 percent after ticking up 0.1 percent in August.

Low inflation, which has persistently run below the Federal Reserve's 2 percent target, is a major hurdle to an interest rate hike this year. Policymakers who are divided on when to tighten monetary policy could take comfort in last month's increase in the core PPI.

Expectations of a lift-off in the U.S. central bank's short-term interest rate have been dealt a blow by an abrupt slowdown in job growth in the last two months and softening economic activity because of a strong dollar, lower oil prices and a weakening global economy.

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