Rising gas prices drove much of the inflation increase as renewed violence in the Middle East has kept oil prices above $100 a barrel, up from below $70 before the Iran war. But prices also rose outside of fuel costs.

Prime minister vows not to slash health and education funding amid political problem over handling of economy

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Anthony Albanese has ruled out major cuts to health, education and essential services in December’s mid-year budget update, but conceded savings are required as Labor struggles to curb accelerating inflation.

Amid growing pressure from within Labor’s own ranks, as well as from the opposition and business, Albanese said the Coalition was hypocritical in not supporting existing savings proposals, including the government’s plan to reduce the private health insurance rebate for people over 65.

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© Photograph: Lukas Coch/AAP

© Photograph: Lukas Coch/AAP

© Photograph: Lukas Coch/AAP

OBR cautions about Middle East war dragging down growth and triggering a fresh cost of living crisis

• Healey offers £100 payment to households to help navigate ‘global economic storms’

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British households face a “pretty grim picture” for living standards as the war in the Middle East drags down growth and triggers a fresh cost of living crisis, the government’s independent forecaster has said.

In a report as John Healey announced his first budget, the Office for Budget Responsibility (OBR) issued a sharp downgrade for growth in 2027, household disposable incomes and the public finances despite the measures taken by the chancellor.

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© Photograph: Vuk Valcic/SOPA Images/Shutterstock

© Photograph: Vuk Valcic/SOPA Images/Shutterstock

© Photograph: Vuk Valcic/SOPA Images/Shutterstock

The Federal Reserve kept its key rate unchanged Wednesday at about 3.9% despite stubbornly high inflation, while providing little hint about the central bank's next moves.

Fed chair Kevin Warsh said politics played no role in pause of interest rate hikes, despite inflation remaining above 3%

The US Federal Reserve left interest rates unchanged on Wednesday during its last board meeting before the midterm elections, keeping rates at one of the highest pre-election levels seen in over 20 years.

Two out of 12 board members voted against the pause, preferring to raise rates by a quarter point this meeting, the Fed board said in a statement.

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© Photograph: Brendan Smialowski/AFP/Getty Images

© Photograph: Brendan Smialowski/AFP/Getty Images

© Photograph: Brendan Smialowski/AFP/Getty Images

The Fed's Oct. 27-28 meeting will be the fourth of Chairman Kevin Warsh's tenure, which has been marked by questions regarding his independence from President Donald Trump, who appointed him earlier this year.

Voters blame Trump, pointing to the Republican president's tariff policies and the war he started with Iran.

Inflation jumps in run-up to Healey’s maiden Budget

Terms like "dynamic pricing" and "surveillance pricing" are stirring up anger and anxiety on social media.