USA: Inflation subsides but price pressures persist

Inflation in the United States eased again in January, in the latest sign that the sharp rise in prices that has plagued Americans for two years is abating.

At the same time, the report on consumer prices released by the government on Tuesday shows that inflationary pressures persist and could lead to price increases throughout this year.

Consumer prices increased 6.4% in January compared to the same month of the previous year, a decrease from the 6.5% registered in December.

It is the seventh consecutive decrease and a much lower figure than the 9.1% registered in June. Even so, it is still above the 2% target set by the Federal Reserve.

On a month-over-month basis, consumer prices increased 0.5% from December to January, much more than the 0.1% increase recorded from November to December. The main factors were the prices of gas, food and clothing.

The US central bank has aggressively raised interest rates in recent months, pushing them to their highest level in 15 years, as it tries to tame inflation.

The institution’s goal is to inhibit credit and spending, cool hiring and alleviate pressures many companies feel to raise wages in order to hire or retain employees.

Businesses often pass on their higher labor costs to consumers through price increases, compounding inflation.

So far, the decline in inflation more reflects the end of supply chain disruptions and lower gasoline prices. But the interest rate hikes, eight since March of last year, have not had much effect on the job market, which remains exceptionally strong.

The unemployment rate is at 3.4%, its lowest level in 53 years, and the available places are still abundant. The strength of the labor market, for its part, has stimulated consumer spending, which is the engine of the US economy.

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