Before the slowdown in inflation begins to appear, the American central bank had already noted its reference rate of reference six times this year.
Le Monde With AP and AFP
sign that the measures taken by the American central bank are starting to bear fruit, inflation in the United States has been at its lowest level since January 2022. The latter slowed down in October, reaching 7.7 % compared to In the previous year and 0.4 % compared to September, said the US government, Thursday, November 10.
The prices of used cars, which have dropped for the fourth month in a row, contributed to the slowdown in inflation from September to October. The prices of clothing and medical care have also decreased. The rise in food prices has slowed down. On the other hand, energy prices increased in October after dropping in August and September.
This overall inflation rate, at the lowest for months, “confirms the idea that the peak of inflation is in place and that the American federal reserve [Fed] will take it into account,” said Alexandre Baradez , analyst at IG France. The Fed should continue to raise interest rates in order to stem residual inflation, but will do it with less vigor than before, because its policy begins to bear fruit. According to Mr. Baradez, investors wait “most likely a rate increase which will not exceed fifty base points” at the next Fed monetary policy meeting, in mid-December, and start “to imagine that The rates can start to cap “.
“We expect it to mark the beginning of a much longer disinflationist trend which, in our opinion, will convince the Fed to end its [increases] at the beginning of next year”, has for its Part declared Paul Ashworth, chief economist for North America at Capital Economics.
Specter of recession
Before the slowdown in inflation begins to appear, the Fed had strongly noted its guiding rates since March. At the beginning of November, it had increased, for the fourth time in a row, three -quarters of percentage point its main key rate to bring it to a range between 3.75 % and 4 %, at the highest since almost fifteen years.
Now, many economists had warned that by continuing to tighten the Crédit Centrale could trigger a recession by next year. The Fed had already noted its reference rate of reference six times in high levels this year, which increases the risk that prohibitive borrowing rates for houses, cars and other expensive items to tip the largest economy in the world in the recession.
Even before the publication of inflation figures, some indicators showed that the price increase had started to decrease. Strong wage increases in the last eighteen months have stabilized. With the exception of car manufacturers, who still have trouble acquiring the chips necessary for their production, the disturbances of the supply chain have largely absorbed. As for classified ads sites, such as Apartment List or Zillow, they are now lowering rents.