U.S. consumer prices surge, jobless claims fall

A key measure of U.S. inflation out Wednesday showed consumer prices in October surged at their fastest pace in more than 30 years.

The biggest sticker shocks came from food and gasoline...

... and the data signal prices could continue to climb painfully higher well into next year... as demand roars back but supply chains remain snarled.

The U.S. Labor Department said the consumer price index - or CPI - rose 0.9% last month after gaining 0.4% in September.

Compared with 12 months ago, the CPI accelerated 6.2%. That's the largest year-on-year advance since November 1990 and followed a nearly five-point-five percent jump in September.

Even taking out sometimes volatile food and energy components, what known as "core CPI" rose 0.6 percent in October from September, and spiked 4.6 percent from a year ago.

Inflation is heating up again after governments poured trillions of dollars toward pandemic relief, fueling demand for products and leaving supply chains overstretched.

The Federal Reserve last week restated its belief that current high inflation is "expected to be transitory" -

"It remains the case that the drivers of higher inflation have been predominantly connected to the dislocations caused by the pandemic."

-but most economists are skeptical.

One reason is that wages are rising strongly as companies scramble for workers.

With labor scarce, companies are holding on to their employees.

In another report on Wednesday, the Labor Department said new state jobless claims fell to 267,000 last week.

That's the lowest level since mid-March in 2020, when mandatory business closures put millions out of work.

The report was published a day early because the federal government is closed on Thursday for Veterans Day.

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