The consumer price inflation hit 7.7% in October 2022, compared to September's reading of 8.2%, as medical care services, used cars, and clothing all saw a price decrease. After two consecutive 0.8% price increases, food prices overall increased by 0.6% for the month. While the price of eating out at restaurants and other such establishments increased for a third consecutive month, groceries increased by 0.4% against an earlier increase of 0.7%. After declining 4.9% in September, gas prices increased 4% in October, bringing the yearly increase to 17.5%. The biggest gasoline inflation rate since March 1980 was recorded in the 12 months ending in June, setting a new record for this year.
The food index increased by 0.6% in October following a 0.8% increase in September. The food-at-home index increased by 0.4% in October, the weakest monthly increase since December 2021. After declining for the previous three months, the energy index rose by 1.8% in October. The gasoline index also experienced a 4.0% fortnight increase after three straight months of declines. Consumer spending, which makes up more than two-thirds of US economic activity, increased by 0.8 percent in October followed by a September increase of 0.6 percent which was not adjusted. The Federal Reserve might consider releasing the brakes if inflation starts to slow down. The Federal Reserve has increased the benchmark short-term interest rate four times so far in 2022.
The US interest rate hit 3.78% in November 2022. In an effort to prevent rising prices in the largest economy in the world, the Federal Reserve has raised a large hike in interest rates. Since March, the bank has increased borrowing prices to cool the economy and reduce price inflation. An economy with lower interest rates enables consumers to borrow more money to invest in new assets and spend more on products and services. As a result, there is more money available for use in the economy as a whole. As a result, demand dominates supply, so to decrease the circulation of money, the central bank raises interest rates.
The Federal Reserve indicated it will continue raising benchmark interest rates much above the current level after increasing them by other three-quarters of a percentage point. In an effort to raise the cost of borrowing and spending money and reduce consumer demand, the central bank has already raised its benchmark rate six times this year, and the fourth 0.75% increase in a row. This rate cycle is the quickest in history, going to drive up borrowing costs to their maximum height in 15 years.
The US unemployment rate remained at 3.7% in November, close to a 50-year low. According to the labor department, the US gained 263,000 jobs in November, indicating yet another strong month for job growth. The latest statistics indicate hiring has remained resilient despite rising interest rates and the revelation of several layoffs in technology and real estate industries, which resulted in 284,000 new posts being created by employers in October and 269,000 in September.
In November, 200,000 new employments in the US were anticipated. The most recent jobs report, the last before the Fed meets to choose its next course of action later this month, will reinforce the central bank's commitment to continue hiking rates. The labor market, however, has remained robust. On track to surpass 2021 as the second-best year for hiring, employers gained 261,000 jobs last month and are adding roughly 407,000 a month on average this year.
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