The annual rate of US consumer inflation has bounced in October after a significant fall through August and September.
Consumer price index (CPI) figures released by the Bureau of Labor Statistics indicated seasonally-adjusted consumer prices increased by +0.3% in October, up from September’s +0.1% but in line with consensus expectations. On a 12-month basis, the consumer inflation rate rebounded to 2.5% after falling to 2.3% in September.
“Core” inflation, a measure of inflation which strips out the volatile food and energy components of the index, increased on a seasonally-adjusted basis by +0.2% for the month, in line with expectations. The annual rate remained unchanged at 2.2%.
The inflation figures were not the only thing weighing on investors as a modest sell-off in US equity markets added to doubts regarding the US economy’s general health. By the end of the day, 2-year Treasury yields had shed 3bps to 2.87%, 10-year yields had lost 2bps to 3.12% but 30-year yields gained 1bp to 3.37%. The USD was a touch weaker against other major currencies.