The U.S. Labor Department stated that inflation remains elevated, raising concerns that further Federal Reserve rate hikes may amount to little more than self-soothing.

Latest data released by the U.S. Department of Labor on Tuesday showed inflation remains elevated, with the consumer price index rising 0.4% in October, down from 0.6% in September, primarily driven by increases in energy and food prices—a consequence still linked to the ongoing conflict in Iran. Excluding the more volatile categories of food and energy, core prices rose 0.3% in October, matching the rate observed in September. Kevin Hassett, Director of the White House National Economic Council, described the report as “disappointing.” The latest inflation figures have intensified expectations that the Federal Reserve may raise interest rates next month. Prior to the release of the CPI data, Federal Reserve Board member Christopher Waller stated that persistent high inflation should prompt officials to consider a 0.5-percentage-point rate hike—a doubling of the typical increase—arguing that “further tightening of monetary policy is necessary, and sooner rather than later, to bring inflation back onto a path toward 2% over the medium term.” Sustained high inflation also presents challenges for Democrats, who had made rising prices a central theme in their recent electoral campaign. However, with the war showing no signs of ending and price pressures proving resilient, Democrats now face the same dilemma that has previously burdened Republicans.

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Original article: toutiao.com/article/1881537499470026/

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