Sunday, November 18, 2007

US inflation hits 3.5 percent in October

(Click on the image to see a larger version)

US inflation shows little sign of subsiding. In the twelve months up to October, consumer prices increased by 3.5 percent. Most of the increase was due to energy prices (up 14.5 percent) and food (up 4.4 percent).

However, nothing to worry about, core inflation is running at just 2.2 percent (that is the last number in the red box).

Core inflation is becoming a dangerous idea. Central banks are now pushing out this index to the public in an effort to distract attention from the growing inflationary prices, which are all too evident in the main index.