U.S. Chamber Urges Caution to Federal Reserve

WASHINGTON, DC – The United States Chamber of Commerce said today's sharp increase in consumer prices was not unexpected, given recent increases in producer prices, the reversal in oil price declines and a rising wage bill.

While the core index was somewhat better behaved, this increase could provide more ammunition for inflation hawks at the Federal Reserve to raise interest rates at their next meeting in November, according to the Chamber.

"With a stock market correction underway, a softening housing sector and some moderation in retail sales, the economy may be slowing on its own," said Martin A. Regalia, Chief Economist at the U.S. Chamber of Commerce. "Raising interest rates at this time could be considered 'piling on'."

Although the major focus is on monetary policy, today's numbers should send a clear warning to Capitol Hill, as well.

"Now is not the time to be raising the minimum wage," said Regalia. "Such an increase will only exacerbate recent wage increases and lead to even greater inflation. Instead, Congress should be focusing on the tight labor markets and figuring out how to change immigration laws to bolster the domestic workforce with productive workers from abroad."

The United States Chamber of Commerce is the world's largest business federation, representing more than three million businesses and organizations of every size, sector and region.

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