A surge in Used Car Prices Drive US Inflation Higher

US inflation

US inflation soared high in September as the prices of used goods and cars sky-rocketed, the most one has seen in 51 years. Consumer inflation which increased slowly in the last four months indicated that the impact of COVID-19 on the cost of goods and services is beginning to evade. 

On Tuesday the Labor Department said that in the previous month, there was a 0.2% increase in the price index of consumers. These statistics are in complete agreement with the forecast of MarketWatch. Since May, this was the smallest hike.

With the onset of the coronavirus, there was a depletion in US inflation but it rose after the re-opening of the economy. Presently, it is returning to a stable graph.

There was an increase of 1.4% in the cost of living when compared to the previous year. US inflation is still at a lower rate considering the widespread effect of COVID-19. In sharp contrast, US inflation was recorded to be 2.5% at the beginning of 2020. 

US Inflation- Cause

In September, the price of used trucks and cars bumped up 6.7%. The price-hike was the biggest since 1969. The cost of used-vehicles increased possibly due to the very low usage of public transportation during the pandemic. There was an increase of 4.2% in the price of natural gas. Meanwhile, the prices of all other goods and services were controlled.