Both consumer and wholesale prices eased in October, according to the Bureau of Labor Statistics. The Consumer Price Index slowed to 7.7% year over year, down from 8.2% last month, resulting in Wall Street's largest boost since 2020, per CNN Business. And prices at the wholesale level rose 8% year over year, down from 8.4% in September—the fourth straight month of decline.
Annual inflation data came in lower than expected from economists, which could be a signal for the Fed to slow interest rate hikes. "The improvement in the October inflation data, if it persists, supports the Fed's expectation of a step down in the pace of increases going forward," Rubeela Farooqi, chief U.S. economist at High Frequency Economics, told AP News.
The Federal Reserve has hiked its benchmark borrowing rate six times this year for a total of 3.75 percentage points, its highest level in 14 years. "Vice Chair Lael Brainard said Monday she expects the pace of hikes soon will slow, through rates are likely to still go higher," reads an article from CNBC. "She said the Fed can move to a more 'deliberate' posture as it watches the impact of its rate hikes, which have included four straight 0.75 percentage point increases, are having on financial conditions."
Core producer prices, which exclude food and fuel, were unchanged in October from September, the lowest reading in nearly two years. Core consumer prices rose 0.3% in October, half the increase of the previous two months, per AP News.