US rates set to stay low after weak inflation
The Labour Department said yesterday its Consumer Price Index edged up 0.1 per cent last month as a rise in food and shelter costs offset a broad decline in energy prices.
The CPI had dropped 0.2 per cent in August and economists had expected a flat reading in September.
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Hide AdUS Treasury debt prices fell on the slightly firmer reading, while the dollar rose modestly.
“This persistently weak inflation backdrop should continue to provide the key justification for the Fed to keep its policy stance accommodative,” said Millan Mulraine, deputy chief economist at TD Securities in New York.
In the 12 months through September, the CPI increased 1.7 per cent after a similar rise in August.
A separate index that tracks price changes for urban wage earners and clerical workers and is used to make cost-of-living adjustments for social security payments rose 1.7 per cent in the third quarter from the year earlier.