Away from the United States, a similar story is playing out this week in Europe and the Pacific: prices and interest rates that are staying higher for longer than many households would like.
In Britain, new figures showed consumer borrowing rose by 2.5 billion pounds in August, a sign that households are increasingly turning to credit cards to manage everyday expenses even as new mortgage lending slows. That combination, more borrowing on cards and fewer new home loans, is a classic signature of an economy where higher interest rates are making big purchases like homes harder to finance, while everyday costs keep pushing people toward short-term credit. The Bank of England has kept its benchmark rate elevated for an extended stretch as it tries to bring inflation back down toward its target, and this week's borrowing data suggests that effort is still working its way through household budgets.
In Spain, annual inflation came in at 4.9 percent, a level that keeps the cost of living squarely in the headlines across the eurozone. Spain has often been used as an early read on price trends across the wider currency bloc, so a reading like this tends to reinforce the case among European Central Bank officials that inflation has not yet been fully tamed. Meanwhile in Australia, the Reserve Bank's cash rate stood at 4.60 percent, reflecting a similar calculus: policymakers there have judged that rates need to stay high enough to keep pressing down on prices, even at the cost of slower growth.
Taken together, the numbers out of London, Madrid, and Canberra point to a global pattern that is now familiar to anyone who has followed the Federal Reserve's own recent decisions: central banks around the world are still weighing how long they can keep borrowing costs elevated before the drag on growth becomes too painful, even as everyday households feel the squeeze from both sides, in the form of pricier goods and pricier credit.
Watch for the Bank of England's and Reserve Bank of Australia's next policy meetings, along with the eurozone-wide inflation reading due after Spain's, for a fuller picture of how quickly price pressures are easing.
Is inflation still a problem outside the United States?
Yes. Data this week from the UK, Spain, and Australia all point to still-elevated prices and borrowing costs.
Why does UK consumer borrowing matter?
A rise in credit card borrowing alongside slower mortgage lending suggests households are leaning on short-term credit to cope with higher costs.