US: Only modest price pressure ahead – Wells Fargo

Inflation numbers for the month of October released on Thursday came in below expectations. Analysts at Wells Fargo, point out that compared to a year-earlier, prices were up 1.2%, which is the slowest pace since July. They expect only modest price pressure as the economy continues to recover.

Key Quotes: 

“Consumer prices were flat in October. Food prices rose 0.2% and were lifted by both food away from home and food at home. Energy prices advanced 0.1% as energy services outpaced a decline in gasoline prices.”

“Excluding food and energy, however, core prices were unchanged from September and continue to be held back by core services. On a year-ago basis, core goods prices were at their highest level since 2012.”

“Overall inflation remains modest as prices continue to unwind from pandemic effects. We expect inflation to climb higher, but remain below its pre-pandemic trend for quite some time.”