US prices rising at 6.2%, fastest rate for three decades

Americans' cost of living is rising faster than it has for three decades, with food and fuel driving the increases.

The consumer prices index for October showed prices rose 6.2% over the last twelve months.

It marks a sharp jump from September when prices were already rising at 5.4%.

Inflation has been a growing concern for shoppers and policymakers this year as the impact of the pandemic persists.

Bottlenecks in the supply of some goods, combined with increasing demand from customers as the vaccine programme allowed the economy to reopen, has put pressure on prices.

A shortage of staff has prompted employers to raise wages in some sectors, too, which in turn can feed into higher prices.

Even excluding the cost of food and fuel, which tend to be more volatile, prices were rising strongly at 4.6%.

Taken on a monthly basis, the US Labor Department said, prices rose 0.9% in October, after gaining 0.4% in September, illustrating the pace of acceleration.

The Federal Reserve has said it believes the current high rate of inflation "to be transitory". As a result, the Fed is not expected to raise interest rates - the usual response to rising inflation.

However, last week, Federal Reserve chair Jerome Powell did announce a scaling back of the Fed's bond-buying programme, the first move towards a tightening of monetary policy.

Some economists are warning inflation could prove more intractable as the scramble for staff and supplies continues to exert pressure on prices.