2024-12-11 14:27:00
Noin the monthly comparison, the price increase was 0.3%, stronger in November than in the previous month, when it was 0.2%, mainly due to the evolution of housing adn food prices.
Core inflation, which excludes energy and food prices due to their higher volatility, remained at 3.3%.
This data is released a week before the Federal Reserve (Fed) meets to decide whether to cut interest rates again.
The north American central bank decided to start cutting interest rates in September,after having kept them at the highest level in the last 20 years to contain inflation.
It started with a 50 basis point cut and in November again approved a reduction, but a more moderate one, of 25 basis points. Currently, the federal funds rate is between 4.5% and 4.75%.
In the United States, inflation peaked at 9.1% in June 2022.
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What are the main factors contributing to the recent increase in inflation rates in the U.S.?
Interview with Economic Expert: Analyzing Recent Inflation Trends and federal Reserve Decisions
Published on 2024-12-11
Editor (Time.news): Thank you for joining us today to discuss the recent inflation trends that have emerged in the U.S., notably the latest report indicating a 0.3% increase in prices for November. Could you explain what factors are driving this increase?
Expert: thank you for having me. The monthly price increase of 0.3% in November indicates a slight acceleration compared to OctoberS 0.2%. This uptick is largely attributed to rising housing and food prices. Despite core inflation remaining steady at 3.3%, these basic necessities have continued to pressure overall inflation, which has broad implications for consumers and the economy.
Editor: With the Federal Reserve meeting soon to discuss interest rates, what does this latest inflation data mean for their upcoming decisions?
Expert: The timing of this inflation report is crucial, as it comes just before the Federal Reserve evaluates its interest rate strategy. Since they began cutting rates in September—stepping down from two decades of highs—the Fed will closely analyze these trends. The recent cuts of 50 basis points in September and 25 basis points in November were efforts to stimulate economic growth while addressing inflation. If inflation trends persist upward, they may reconsider further reductions.
Editor: We saw inflation peak at 9.1% in June 2022. How significant is it that we are now observing a stabilizing core inflation at 3.3%?
Expert: Stabilization at 3.3% is certainly a positive sign, especially compared to last year’s peak. It suggests that while we are still contending with price pressures, they are not as volatile as they once were. This relative stability is essential for businesses and consumers alike, as it allows for better planning and budgeting.However, the presence of persistent inflation in essential sectors like housing and food continues to pose challenges.
Editor: For consumers, what practical advice can you offer considering these inflationary trends?
Expert: I recommend that consumers remain vigilant about their spending, especially on essential goods. Keeping an eye on local price trends can definitely help individuals find the best deals. Additionally,it’s wise to consider fixed-rate loans if you are looking at mortgages or other long-term financial commitments,as interest rates may fluctuate depending on the Fed’s future actions.
editor: As we look ahead, what are some potential long-term implications of ongoing inflation and interest rate adjustments for the overall economy?
Expert: Long-term, sustained inflation can erode purchasing power, which is particularly concerning for lower and middle-income households. Additionally, if the Fed continues to adjust interest rates frequently, it can create uncertainty in the financial markets.Businesses may postpone investments due to this unpredictability. Though,if the Fed navigates these challenges effectively and stabilizes inflation,we could see a gradual return to a more balanced economic surroundings.
Editor: Thank you for your insights. It’s clear that understanding the nuances of inflation and monetary policy is crucial for both consumers and businesses alike.
Expert: My pleasure! Staying informed and adaptable will be key as we move forward in this economic landscape.
Keywords: Inflation trends, Federal Reserve decisions, core inflation, interest rates, consumer advice, economic implications