US inflation stays high despite drop in petrol prices

US consumer prices rose more than expected in October, even as petrol prices fell to a four‑month low.

The US Department of Labor’s Bureau of Labour Statistics reported on Tuesday that the Consumer Price Index (CPI) for all items increased by 0.4 percent in October, continuing an upward trend since July. This figure exceeded the Federal Reserve Bank of Cleveland’s forecast of a 0.2 percent rise and the 0.3 percent increase predicted by economists surveyed by FactSet.

Alongside the CPI gain, the average cost of shelter and food also rose in October. Meanwhile, the American Automobile Association said the average price of a gallon of petrol dropped below $4 (about €1.06 per litre) for the first time since July, settling at $3.98. The price remains well above the $3.07 level recorded a year earlier.

President Donald Trump said on Monday that further military action against Tehran was unlikely, describing Iran’s military as “effectively over”. The war on Iran, which began on 28 February, has been cited by the administration as a factor in the recent mid‑term elections.

In the November 3 mid‑term vote, Republicans lost control of both the US House of Representatives and the Senate. A Reuters/Ipsos poll conducted on the eve of the election found that 78 percent of voters considered cost‑of‑living issues very important, with 43 percent favouring Democrats over 32 percent for Republicans. Approval of Trump’s performance slipped to 32 percent, just above a record low of 31 percent the previous month.

Source: Al Jazeera. Photo: Erik Mclean / Pexels.