Inflation accelerated sharply and well above forecasts in October, with U.S. consumer prices rising at their fastest over-the-year pace in more than three decades as persistent supply chain bottlenecks continue to push prices skyward.
Economists polled by Bloomberg predicted the Nov. 10 CPI print would come in at 5.9 percent over the year and 0.6 percent over the month.
“No matter how squishy the definition of ‘transitory’ might be, it is undeniable that inflation is a problem,” Bankrate Chief Financial Analyst Greg McBride told The Epoch Times in an emailed statement.
While prior months saw sharp price surges within a relatively narrow scope, price pressures have been seeping into other categories.
“Inflation is broadening out,“ McBride said. ”In addition to food, energy, and shelter continuing to post outsized monthly increases, new and used car prices are once again shifting into overdrive.”
Used car prices jumped 2.5 percent over the month and 26.4 percent over the year in October. New car prices rose 1.4 percent for the month and 9.8 percent for the 12 months through October.
Transportation services prices, which fell by 0.5 percent last month, jumped 0.4 percent over the month in October and 4.5 percent over the year.
The biggest contributor on a monthly and annual basis was fuel oil, which spiked 12.3 percent over the month and 59.1 percent over the year in October.
The reading added to concerns about consumer price inflation as higher production costs tend to trickle down to consumers.
But that becomes less likely the longer the supply chain bottlenecks persist, the ING team argued, “which means that we expect goods inflation to further increase over the coming months and to remain elevated throughout the first half of the year as pipeline pressures remain fierce.”
With prices running high and little sign of immediate relief, consumer expectations for what the rate of inflation will be in the future in the United States have risen to all-time highs.
“Inflation concerns are weighing on consumer confidence, and with an annual rate of north of 6 percent, this will only continue,“ McBride said, also predicting that supply chain bottlenecks ”will be with us well into 2022, and with that, upward pressure on prices.”
“Consumers are feeling it in the pocketbook at the gas pump, grocery store and tenants in many parts of the country could get sticker shock at their next lease renewal,” he said.