(RTTNews) – Consumer prices in the United States rose at the fastest annual rate in nearly 40 years in November, according to a report released by the Department of Labor on Friday.
The report showed that the annual growth rate of consumer prices accelerated to 6.8% in November from 6.2% in October, reflecting the biggest jump since June 1982.
Energy prices have climbed 33.3% over the past year, while food prices have climbed 6.1%.
Consumer staples, which exclude food and energy prices, rose 4.9% from the same month a year ago, posting the largest annual increase since June 1991.
Significantly higher prices for used cars and trucks, new vehicles, shelter and medical care all contributed to the increase in base prices year over year.
The faster annual growth came as consumer prices climbed 0.8% in November after rising 0.9% in October. Economists expected consumer prices to rise 0.7%.
The continued price growth is partly due to a further surge in energy prices, which climbed 3.5% in November after rising 4.8% in October.
Food prices also advanced 0.7% in November, reflecting widespread increases in food prices at home and abroad.
Excluding food and energy prices, underlying consumer prices rose 0.5% in November after rising 0.6% in October. The increase in basic prices is in line with economists’ estimates.
The Labor Department said the housing index rose 0.5%, with the rent indices and homeowners’ equivalent rents both rising 0.4%.
Strong increases in the prices of used cars and trucks, new vehicles and clothing also contributed to the growth in basic consumer prices.
âThe biggest problem for the Fed is growing evidence of a strong recovery in cyclical price pressures,â said Paul Ashworth, chief US economist at Capital Economics. “The bottom line is that while we think headline inflation has now peaked, it will only gradually decline over the first half of next year.”
He added: âImportantly, because of this growing cyclical pressure, we expect core inflation to stay above the Fed’s 2% target for an extended period.
Next Tuesday, the Labor Department is expected to release a separate producer price report in November.
The producer price index is expected to increase 0.6% in November, while basic producer prices are expected to increase 0.4%.
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