Higher gas prices are intensifying inflation, with the producer price index up 6.3% in September from a year earlier, the biggest rise in nearly four years, and consumer inflation reaching 3.7%. Rising shipping costs pushed wholesale food prices up 1.2% from August. Still, retail sales rose 0.8% in September, above forecasts, driven by a 6.4% jump at gas stations and a 1.1% rise at restaurants and bars, while sales excluding gas rose only 0.2%. The job market remains relatively firm, with jobless claims below 200,000, but September hiring slowed to 29,000 jobs and the unemployment rate ticked up to 4.2%. Inflation-adjusted weekly paychecks fell year on year for the first time since May, and minutes suggest the Fed will likely raise rates again this year after lifting its key rate to about 3.9% in September.
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Original headline: How long can US consumers muscle through higher prices ?
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- US consumers are muscling through higher prices, but for how long?
High gas prices pushed inflation up to 3.7% in September, yet American consumers kept spending, supporting economic growth for now. The producer price index jumped 6.3% from a year earlier, gas prices rose 20% from August, and diesel averaged $6.32 a gallon versus $3.66 a year ago, raising shipping and food costs. Retail sales rose 0.8% in September, but excluding gas stations they rose only 0.2%. Jobless claims stayed below 200,000, yet September hiring slowed to 29,000 and inflation-adjusted weekly paychecks fell from a year earlier for the first time since May. Most Fed officials expect another rate increase this year, and the average long-term US mortgage rate is 7.4%.
- US consumers are muscling through higher prices , but for how long ? - The Business Journal Inflation Rises as High Gas Prices Strain Consumers Despite Strong Spending
Inflation accelerated in September as higher gas and diesel prices lifted costs in shipping, warehousing and wholesale food, with the producer price index up 6.3% from a year earlier and consumer inflation at 3.7%. Despite this, consumers kept spending: retail sales rose 0.8% from August, more than economists had forecast, driven by a 6.4% jump at gas stations, while sales excluding gas rose just 0.2%. The job market remains relatively firm, with weekly jobless claims below 200,000, though September hiring slowed to 29,000 jobs and inflation-adjusted paychecks fell from a year earlier for the first time since May. Economists warn persistent inflation could erode spending power, and Fed minutes show most officials expect another rate increase this year after the September rise to about 3.9%.
- US consumers are muscling through higher prices, but for how long?
Inflation accelerated in September as higher gas and diesel prices spread to shipping and food, with producer prices up 6.3% from a year earlier, the biggest rise in nearly four years. Consumer inflation hit 3.7%, far above the Fed's 2% target, and wholesale food prices jumped 1.2% in the month, which could make groceries more expensive. Retail sales still rose 0.8% from August, led by a 6.4% jump at gas stations, though much of the gain reflected higher prices. Jobless claims stayed below 200,000, but hiring slowed to 29,000 from a revised 133,000 in August, and inflation-adjusted weekly pay fell from a year earlier. Most Fed officials expect another rate increase may be needed this year, which would raise borrowing costs for mortgages, car loans and credit cards.
- US consumers are muscling through higher prices , but for how long ?
- US consumers are muscling through higher prices , but for how long ?
High gas prices are driving up inflation and taking more of Americans' money, yet consumers are still spending, keeping the economy growing. The producer price index rose 6.3% from a year earlier, its biggest increase in nearly four years, with gas prices up 20% in a single month; diesel averaged $6.32 a gallon, up from $3.66 a year ago, raising shipping and food costs. Retail sales rose 0.8% from the previous month, driven by a 6.4% jump at gas stations, while excluding gas they rose just 0.2%. Hiring slowed sharply, but jobless claims stayed below 200,000 and the unemployment rate was 4.2%. Economists warn persistent inflation will erode spending power, and the Fed, with its rate at about 3.9% after a recent small increase, may raise rates again this year.
- US consumers are muscling through higher prices, but for how long?
High gas prices are pushing up inflation and taking a bigger share of Americans' spending power, yet consumers keep spending strongly and supporting economic growth. The producer price index rose 6.3% in September from a year earlier, while diesel averaged $6.32 a gallon versus $3.66 a year ago, raising shipping costs and possibly grocery prices. Retail sales rose 0.8% from August, but excluding gas they rose only 0.2%; hiring slowed to 29,000 jobs in September, though jobless claims stayed below 200,000. Inflation reached 3.7% in September, and the Fed raised its key rate to about 3.9% in September; minutes show most officials expect another increase this year.
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