Inflation drops

to 2021 levels

As a presidential race profoundly shaped by Americans’ frustration with high prices nears its end, the government said Thursday that an inflation gauge closely watched by the Federal Reserve has dropped to near pre-pandemic levels. Prices rose just 2.1% in September from a year earlier, down from a 2.3% rise in August. That is barely above the Fed’s 2% inflation target and in line with readings in 2018, well before prices began surging after the pandemic recession. Yet some signs of inflation pressures remained. Excluding volatile food and energy costs, so-called core prices rose 2.7% in September from a year earlier for the third straight month.

Mortgage rates rise

fifth straight week

The average rate on a 30-year mortgage in the U.S. rose for the fifth straight week, returning to its highest level since early August. The rate rose to 6.72% from 6.54% last week, mortgage buyer Freddie Mac said Thursday. That’s still down from a year ago, when the rate averaged 7.76%. When mortgage rates increase they can add hundreds of dollars a month in costs for borrowers. Mortgage rates are influenced by several factors, including how the bond market reacts to the Federal Reserve’s interest rate policy decisions and data on inflation and the economy. Bond yields have been rallying following a string of stronger-than-expected reports on the U.S. economy.

Microsoft sales

grow by 16%

Microsoft on Wednesday reported its quarterly sales grew 16% to $65.6 billion as the company sought to assure investors its huge spending on artificial intelligence is paying off. The company has spent billions of dollars to expand its global network of data centers and other physical infrastructure required to develop AI technology that can compose documents, make images and serve as a lifelike personal assistant at work or home. As a result, AI-related products are now on track to contribute about $10 billion to the company’s annual revenue, the “fastest business in our history to reach this milestone,” CEO Satya Nadella said on a call with analysts Wednesday.

Jobless claims

fell last week

Fewer Americans filed for unemployment benefits last week as layoffs remained at historically healthy levels despite elevated interest rates. The Labor Department reported Thursday that jobless claim applications fell by 12,000 to 216,000 for the week of Oct. 26. That’s fewer than the 227,000 analysts forecast. Weekly applications for jobless benefits are considered a proxy for U.S. layoffs. The four-week average of weekly claims, which quiets some of the week-to-week fluctuations, fell by 2,250 to 236,500. Continuing claims, the total number of Americans collecting jobless benefits, declined by 26,000 to 1.86 million for the week of Oct. 19.

— Bulletin wire reports