Inflation rose slightly in September, as revealed by the Bureau of Labor Statistics (BLS). The consumer price index (CPI) increased by 0.6% last month, reaching 3.7% compared to September of the previous year. This is an increment from August when annual inflation was at 3.4%.
Gas prices significantly impacted the inflation figures, rising by 9.1% in September. This accounted for more than half of the monthly inflation increase. Overall energy prices increased by 5.2%, up from a 2.1% rise in August. Food prices remained stable, increasing by 2.5% over the last year.
The ongoing situation in Iran continues to affect fuel costs, making it challenging for efforts aimed at reducing diesel and gas prices to succeed.
The cost of regular gas reached approximately $4.33 as of Wednesday morning, compared to $2.98 prior to the U.S. and Israel’s war initiatives, according to AAA data. Diesel prices also rose significantly, with an increase of roughly $2.64 compared to a year ago.
Core annual inflation, which excludes food and energy prices, was at 2.6%, exceeding the Cleveland Fed’s projection of 2.4%. Heather Long from Navy Federal Credit Union highlighted how the inflation spike was primarily driven by rising gas and diesel prices, alongside increased airfares and used car prices.
The intersection of rising inflation and wage growth is another concern; inflation climbed 3.7%, effectively offsetting the 3% average wage gains.
Other Economic News
Japan announced funding for a $21 billion project to expand chip production in New York. The Supreme Court is considering how a 1980s privacy law should apply to internet tracking. Meanwhile, more than 40% of Americans report difficulties in affording basic necessities amid the inflation rise.
The Social Security benefits are forecasted to increase by 3.6% in 2027, according to an announcement by the Trump administration.
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