Inflation declining more slowly than previously anticipated: Fed minutes
The CPI, CPE and PPI indexes have all risen more than expected recently
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Federal Reserve officials observed that inflation was falling more slowly than they had previously anticipated, according to minutes from their September meeting.
"Participants commented that recent inflation data generally had come in above expectations and that, correspondingly, inflation was declining more slowly that they had previously been anticipating," the minutes, released Wednesday, said.
Philip Jefferson, governor of the US Federal Reserve, from left, Christopher Waller, governor of the US Federal Reserve, Lael Brainard, vice chair of the US Federal Reserve, Jerome Powell, chairman of the US Federal Reserve, Michael Barr, vice chair (Al Drago/Bloomberg via Getty Images / Getty Images)
In August, inflation measured by the consumer price index went up and 0.1% from July and 8.3% from the prior year, both figures higher than economists expected. The personal consumption expenditures index, the Fed’s preferred inflation gauge, also came in higher than forecasted, climbing 6.2% in August from a year ago and 0.3% from July.
WHOLESALE INFLATION RISES MORE THAN EXPECTED IN SEPTEMBER, WITH PRICES JUMPING 8.5%
Wholesale inflation — measured by the producer price index — rose 8.5% in September from the prior year and 0.4% from August, the Labor Department said Wednesday. Those figures both came in higher than some economists predicted.
US JOB GROWTH SLOWS AGAIN IN SEPTEMBER WITH JUST 263,000 POSITIONS ADDED
Fed officials expect inflation to persist "in the near-term," citing factors including "labor market tightness and the resulting upward pressure on nominal wages, continuing supply chain disruptions and the persistent nature of increases in service prices, particularly shelter prices," according to the minutes. However, they projected it would "gradually recede in the coming years."
This May 4, 2021, file photo shows the Federal Reserve building in Washington. (AP Photo/Patrick Semansky, File / Associated Press)
The Federal Reserve Building in downtown Washington DC, USA at night. HDR image. (iStock / iStock)
In an attempt to wrestle inflation close to its 2% goal, the Fed has raised interest rates multiple times this year, including three back-to-back 75-basis-point hikes. More rate increases are likely in the pipeline, and concerns have grown that the central bank’s aggressive hikes could result in an economic downturn or recession, FOX Business previously reported.
At their September meeting, Fed officials affirmed that the Federal Open Market Committee remains "strongly committed to returning inflation to its 2 percent objective," according to the minutes.
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The Labor Department is scheduled to release September’s CPI data on Thursday morning. Refinitiv economists have predicted inflation as measured by the CPI rose 0.3% month-over-month.
Megan Henney contributed to this report.