Underlying US inflation ran at a faster-than-expected monthly pace in August, leaving the door open for additional interest-rate hikes from the Federal Reserve.
The so-called core consumer price index, which excludes food and energy costs, advanced 0.3 percent from July, the first acceleration in six months, Bureau of Labor Statistics data showed Wednesday. From a year ago, it increased 4.3 prcent, in line with estimates and marking the smallest advance in nearly two years.
Economists favor the core gauge as a better indicator of underlying inflation than the overall CPI. That measure rose 0.6 percent from the prior month, the most in over a year, and 3.7 percent from a year ago, reflecting higher energy prices.
The report adds to concerns that the renewed momentum in the economy is reigniting price pressures. While Fed officials have been growing more optimistic they can tame inflation without a recession, a reacceleration in price growth could force them to push interest rates even higher, with the risk of sparking a downturn in the process.
In other news, Jay Clayton, former chair of the US Securities and Exchange Commission, said US public firms should start disclosing their exposure to China as part of a pilot program to allow investors and policymakers to see potential risks.
Clayton is appearing at a hearing hosted by the House of Representatives select committee on the Chinese Communist Party, which is exploring risks China poses to US financial stability.
Clayton will propose that large companies with market capitalizations above $50 billion (HK$390 billion) or with China-based revenues or costs above $10 billion to unveil their exposure to the world's second biggest economy.
Jay Clayton
