The Federal Reserve of the United States (Fed) has decided to continue carefully evaluating incoming economic data, especially the inflation rate, before considering additional adjustments to monetary policy. After eleven increases in the benchmark rate since March 2022 to contain inflation, the interest rate has remained in the range of 5.25% to 5.5% since July 2023, the highest level since January 2001. However, in September, the central bank began a reduction in interest rates upon observing a sustained decrease in inflation.
Unemployment is another key indicator that the Fed closely monitors for decision-making. Recently, it was reported that job creation in the United States was affected in October, generating only 12,000 net jobs, 211,000 fewer than the previous month due to factors such as hurricanes and strikes. Despite this, the unemployment rate remained at 4.1%, a figure that economists consider low.
While the US economy remains solid and without imminent risk of recession, the Bureau of Labor Statistics reported a two-tenths increase in the inflation rate in October, reaching 2.6% and breaking six consecutive months of decline. Meanwhile, core inflation remained stable at 3.3%, a crucial index for the Fed.
On a monthly basis, consumer prices increased by two-tenths, with significant increases in the housing index, which rose by 0.4%, and in the food index, which increased by 0.2%. On the other hand, the energy index remained unchanged in October following a decrease in September.
Last Thursday, the Fed announced a new decrease of a quarter point in interest rates, bringing them to a range of 4.5% to 4.75%. Additionally, it was reported that Gross Domestic Product (GDP) grew by 0.7% in the third quarter of 2024, maintaining the same figure recorded in the previous quarter.
