In the United States, according to the latest reports, inflation exceeded expectations with a monthly increase of 0.4%. The annual inflation rate remained unchanged at 3.7%. Inflation, which is one of the most important indicators of the U.S. economy, continues to be a topic of interest for investors and economic experts in recent times.
The annual Consumer Price Index (CPI) increased by 3.7%, staying above the expected 3.6%. This situation may indicate that inflation is on a stable upward trend.
Producer Price Index (PPI)
Additionally, in the United States, the Producer Price Index (PPI) increased by 0.5% in September compared to the previous month. During this period, gasoline prices also showed a 5.4% increase. Excluding food and energy prices, the Core Producer Price Index (PPI) recorded a 0.3% increase. The rate of increase in the PPI was 2.2%.
Core inflation, which excludes energy and food prices, increased by 3.1% in September. On an annual basis, core inflation continued its rise, reaching 4.1%, meeting expectations.
The higher-than-expected inflation in the U.S. economy can influence central bank policy decisions and have adverse effects on consumer spending.
What Happens If Inflation Rises?
The Consumer Price Index (CPI) is considered a measure that reflects the average changes in the prices of a specific basket of goods and services typically purchased by a typical consumer.
This indicator measures the prices of goods and services purchased by households. An increase in the CPI is often interpreted as a sign of inflation and can adversely affect consumers’ purchasing power. In particular, increases in energy prices can raise the costs of essential needs such as transportation, heating, and electricity.
When inflation rises, central banks typically raise interest rates to control it. This increases the cost of borrowing, leading to additional costs for both consumers and businesses.