US inflation cools down at slow pace

Uncertainty has returned to monetary policy in the U.S., which made a big cut (0.5 percentage points decrease in base rates) before South Korea. The slower-than-expected cool-down in inflation has led some to speculate that the rates might be frozen next month.

The U.S. consumer price index (CPI) rose 2.4 percent in September from a year earlier, beating market expectations of 2.3 percent, according to data released on Thursday (local time). On a month-over-month basis, it increased by 0.2%, 0.1 percentage point higher than forecast. “I am totally comfortable with skipping a meeting if the data suggests that’s appropriate,” Atlanta Federal Reserve Bank President Raphael Bostic told the Wall Street Journal. He added that he proposed only one more rate cut in the two remaining meetings this year at a September meeting of the Federal Open Market Committee (FOMC). The FOMC meets on November 6 and 7.

However, some said they weren’t too concerned with the CPI. “There’s a wobble in the CPI index this month, but we’ve observed a pretty steady slowdown in inflation,” New York Federal Reserve Bank President John Williams said, according to Bloomberg. “Disinflation (slowing inflation) in the U.S. will continue, but not at the pace the market is expecting,” said Shin Eol, a researcher at Sangsangin Investment & Securities.


이호 기자 number2@donga.com