Published 09 Nov, 2022
Inflation was front and center on everyone’s minds this month, especially during the Midterm Elections on Nov 8, 2022. The Fed’s fourth 75 basis point rate rise in a row left the markets contemplating higher rates and turbulence ahead. However, the US economy is still very mixed. Let’s dive into the numbers and see what the data tells us.
The US Truflation CPI has dropped from 8.5% at the end of September to 7.5% at the end of October, and today is at 7.3% on Nov 9, the lowest level in 2022. The main Truflation categories contributing to our index declines were:
However, these declines were partially offset by the following increases:
Recently released macroeconomic data combined with the Truflation indexes suggest mixed signals and turbulent times ahead:
Lynn Franco at The Conference Board recently said:
“Consumer confidence retreated in October after advancing in August and September. The Present Situation Index fell sharply, suggesting economic growth slowed to start Q4. Consumers’ expectations regarding the short-term outlook remained dismal. The Expectations Index is still lingering below a reading of 80—a level associated with recession—suggesting recession risks appear to be rising.”
US consumers are increasingly more aware of the economic risks, despite the US economy adding 261,000 jobs in October, which continued to reflect the tight labor market.
The buoyant jobs market has allowed demand to hold steady as average hourly earnings have increased 4.7% YoY in 2022 in the private nonfarm payrolls. However, real wage growth is negative because US prices have risen faster than wages. Businesses have passed higher costs onto consumers through profit margin expansion. The narrative of scarcity has also been used to justify this expansion.
All this reinforces that turbulent times are ahead. As for the impact on inflation, Truflation is predicting the BLS US CPI to drop between 0.3-0.4% from 8.2% last month in its October release this Thursday.
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Written by CeAnn Simpson
Truflation is an economic data aggregator serving independent, unbiased, real-time data on-chain and off-chain. Truflation’s mission is to help individuals, investors, companies, and institutions make more informed decisions by accessing independent and unbiased economic information.
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