Inflation levels ticked upwards in October, as the metric remains between annual levels of 2% and 3%. Over the last 12 months, the all items Consumer Price Index (CPI) increased 2.6% before seasonal adjustments.
The CPI increased 0.2% on a seasonally adjusted basis in October, matching the increase from each of the previous three months, according to the U.S. Bureau of Labor Statistics (BLS).
On an annual basis, the CPI has posted below 3.0% growth since June, with October representing the first increase in inflation from the prior month since March.
The index for shelter rose 0.4% in October, accounting for over half of the monthly all items increase. According to an analysis by the NAHB, shelter—which has been the main driver of inflation for much of the past year—accounted for over 65% of the 12-month increase in the all items less food and energy index in October.
The index for shelter increased 4.9% over the last year, the second consecutive month the indicator has been below 5% on an annual basis.
Other top contributors to inflation that rose in October include indexes for used cars and trucks (+2.7%), airline fares (+3.2%), medical care (+0.3%), and recreation (+0.4%).
The index for owners’ equivalent rent rose 0.4% and the index for rent rose 0.3% in October, according to the BLS.
NAHB’s “real” rent index—which indicates whether inflation in rents is faster or slower than overall inflation—remained unchanged for the second consecutive month. Over the first ten months of 2024, the monthly growth rate of the real rent index averaged 0.1%, slower than the average of 0.2% in 2023.
Given the context of the 2024 election result, NAHB says proposed tax cuts and tariffs could increase inflationary pressures in the future.
“Given the housing market’s sensitivity to interest rates, this could extend the affordability crisis and constrain housing supply as builders continue to grapple with lingering supply chain challenges,” the NAHB wrote in its analysis of the October inflation reading.
