Consumer inflation in the US cooled for an 11th straight month on an annual basis last month, the US Department of Labor said on Tuesday, in an encouraging sign for policymakers.
The figures came as US Federal Reserve officials began a two-day policy meeting and could allow room for a pause in the central bank’s interest rate hikes at the end of their gathering.
While the Fed has lifted the benchmark lending rate 10 times consecutively since early last year to rein in inflation, it is widely anticipated to hold off on further hikes this week due to signs of cooling in the world’s biggest economy.
Photo: AFP
The consumer price index (CPI) in May jumped 4 percent from a year earlier, in line with analyst expectations and down from 4.9 percent in April.
That brings it to the lowest level in about two years, and less than half the peak rate of 9.1 percent in the middle of last year.
On a monthly basis, the CPI rose 0.1 percent, decelerating from 0.4 percent in April, the department said.
Excluding the volatile food and energy components, consumer inflation was up 5.3 percent over the past 12 months.
“The index for shelter was the largest contributor to the monthly all items increase, followed by an increase in the index for used cars and trucks,” the department said.
However, while there was a “leap” in used vehicle prices last month, it was probably the last of a response to an earlier surge in auction prices, Pantheon Macroeconomics Ltd chief economist Ian Shepherdson said.
“CPI used vehicle prices will fall over the summer, likely starting as soon as June,” he said in a note.
Rent growth is also set to slow, he added.
Meanwhile, new vehicle prices dipped on a monthly basis on improving supply and “softer demand in the face of tightening credit conditions,” he said.
“While inflation rates remain elevated, the moderate slowing provides the Fed room to pause its rate hikes,” Nationwide chief economist Kathy Bostjancic said in a note.
For now, halting further rate increases allows the Fed more time to assess the economic effects of its earlier actions, which came on top of recent pressures in the banking sector.
However, when it comes to the future policy path, “incoming information on inflation, the labor market as well as considerations about credit conditions” would determine if the Fed is done raising rates, High Frequency Economics chief US economist Rubeela Farooqi said.
The domestic unit of the Chinese-owned, Dutch-headquartered chipmaker Nexperia BV will soon be able to produce semiconductors locally within China, according to two company sources. Nexperia is at the center of a global tug-of-war over critical semiconductor technology, with a Dutch court in February ordering a probe into alleged mismanagement at the company. The geopolitical tussle has disrupted supply chains, with some carmakers reportedly forced to cut production due to chip shortages. Local production would allow Nexperia’s domestic arm, Nexperia Semiconductors (China) Ltd (安世半導體中國), to bypass restrictions in place since October on the supply of silicon wafers — etched with tiny components to
Singapore-based ride-hailing and delivery giant Grab Holdings Ltd has applied for regulatory approval to acquire the Taiwan operations of Germany-based Delivery Hero SE's Foodpanda in a deal valued at about US$600 million. Grab submitted the filing to the Fair Trade Commission on Friday last week, with the transaction subject to regulatory review and approval, the company said in a statement yesterday. Its independent governance structure would help foster a healthy and competitive market in Taiwan if the deal is approved, Grab said. Grab, which is listed on the NASDAQ, said in the filing that US-based Uber Technologies Inc holds about 13 percent of
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) yesterday received government approval to deploy its advanced 3-nanometer (3nm) process at its second fab currently under construction in Japan, the Ministry of Economic Affairs said in a news release. The ministry green-lit the plan for the facility in Kumamoto, which is scheduled to start installing equipment and come online in 2028 with a monthly production capacity of 15,000 12-inch wafers, the ministry said. The Department of Investment Review in June 2024 authorized a US$5.26 billion investment for the facility, slated to manufacture 6- to 12nm chips, significantly less advanced than 3nm process. At a meeting with
Taiwan is open to joining a global liquefied natural gas (LNG) program if one is created, but on the condition that countries provide delivery even in a scenario where there is a conflict with China, an energy department official said yesterday. While Taiwan’s priority is to have enough LNG at home, the nation is open to exploring potential strategic reserves in other countries such as Japan or South Korea, Energy Administration Deputy Director-General Chen Chung-hsien (陳崇憲) said. While the LNG market does not have a global reserve for emergencies like that of oil, the concept has been raised a few times —
RSS