According to a recent report released by the Bureau of Labor Statistics, prices were steady in October as inflation slowed further. The consumer price index, which measures the level of prices for goods and services bought by consumers, was unchanged in October.
Excluding food and energy costs, the underlying rate of inflation rose by 0.2% in October. Core prices had increased by 0.3% in September. The overall rate of inflation has been slowing since hitting a peak of 2.9% in July of this year.
The slower pace of inflation is a good sign for the economy, as rising prices have been a factor weighing on consumer spending. Consumers may be more willing to spend, if they know that prices are not rising rapidly.
The price of food, housing, and medical care all rose in October. The cost of food increased by 0.2% and medical care rose by 0.8%. Prices for both rents and owners’ equivalent rent, a measure of housing costs, increased by 0.2% during the month.
On the other hand, transportation costs fell in October. Gasoline prices and airfares both declined. as yearly declines in airline fares continued.
In general, the inflation measures compare favorably to the Federal Reserve’s target of 2% inflation. The Fed’s target implies that prices should be rising steadily, but not so rapidly that they become burdensome.
Overall, prices were fairly steady in October as inflation slowed further. The slower pace of inflation is a good sign for the economy and should give consumers some relief.