The economy of the world took a huge hit this year due to the disruptions caused by the ongoing COVID-19 pandemic. Countries had to close their borders and followed many restrictions to curb the transmission of the virus. Amid all these difficulties, inflation worries weighed heavily on the minds of many citizens. However, prices held steady in October 2020 as inflation slowed further.
According to a market survey, the Consumer Price Index (CPI) – the measure of prices of a basket of goods and services – rose 1.2% in October. This was a significant slowdown compared to the 1.4% rise in September. The report also noted that prices of clothing, medical care, recreation and motor vehicles fell year-on-year.
The index of producer prices – which shows the change in prices of goods and services bought by businesses – increased by just 0.4% annually in October. This was far lower than the 1.1% rise in September.
The report attributed the slowdown in inflation to factors such as the fall in demand for products due to pandemic-induced lockdowns, the volatile energy prices, and weak consumer spending.
The report further said that inflation is expected to remain around the same level or slow down further until the pandemic subsides.
Analysts have welcomed the news and are noting that it will positively impact the economy in the coming months.
For now, the trend of prices staying fairly steady is a welcome development for consumers. However, it is important for citizens to remain vigilant about their spending habits in order to make the most out of the present conditions.