The cost of living in the US rose more than expected in October, as the price of fuel, food and cars helped drive costs higher, according to a Labor Department report released Wednesday.
Consumer prices rose 0.3 percent in the month after a 0.2 percent increase in September, according to the latest Consumer Price Index (CPI) data. Many analysts were expecting a 0.2 percent increase, according to reports.
Core inflation, which exclude volatile food and energy costs, rose by 0.2 percent.
"I don’t see anything in the report that suggests there’s any real inflation flare-up," Joseph LaVorgna, chief U.S. economist at Deutsche Bank Securities Inc. in New York, said on Bloomberg. "The Fed is comfortably on hold."
Annual US inflation fell 0.2 percent. Core 12-month inflation rose 1.7 percent after a 1.5 percent rise was noted in September. The reading is within the Federal Reserve’s 1 percent to 2 percent comfort zone, although it is approaching the upper boundary.
Gold is often purchased as a hedge against inflation. The report from government today was noted, but in a different light by at least one analyst.
"Low inflation pressures are traditionally a negative for gold prices. If, however, weak inflation data are seen as allowing the Fed to continue to pursue easy monetary policies, this may be seen as supportive of gold," HSBC analyst James Steel said in a research brief that was cited on MarketWatch.
As of late, the US dollar has been mostly responsible for driving the yellow metal higher. New York gold futures hit another all-time record Wednesday, rising above $1,150 an ounce.
Consumer price figures in October
Several price figures for October follow:
- New vehicles prices climbed 1.6 percent following a 0.4 percent rise in
- Used car and truck prices rose soared 3.4 percent after rising 1.6 percent in the month prior
- Energy prices jumped 1.5 percent after a 0.6 percent increase in September
- Food prices rose 0.1 percent after declining 0.1 percent
- Gasoline prices rose 1.6 percent following an increase of 1.0 percent from the month prior
- Clothing prices declined 0.4 percent in October after declining 0.1 percent in the month prior
- Meats, poultry, fish and egg prices fell 0.2 percent after a 1.2 percent decline in September
U.S. Inflation Calculator Update
Using the most recent Consumer Price Index data, the CoinNews Inflation Calculator shows how consumer prices have changed over the years. By entering any two dates from 1913-2009 and then a dollar amount, the calculator measures the buying power of the dollar over time. Inflation over the years can be seen with these few calculator examples:
- An item purchased in 1913 for $1 would now cost $21.84 (2 cents more as compared to September)
- An item purchased in 1950 for $10 would now cost $89.70 (9 cents more as compared to September)
- An item purchased for $20 in 1985 would now cost $40.18 (4 cents more as compared to September)
Mixed dates may also be used with the Inflation Calculator. As examples:
- An item purchased today for $500 would have cost $124.44 in 1975
- An item purchased for $1000 in 1980 would have cost $1,586.17 in 1990
Of course, not all "goods and services" rise or fall in tandem with inflation rates. For example, many computers when adjusted for inflation are actually less expensive today (and do more) compared to years ago.