Prices rose faster than expected last month, putting more pressure on Americans’ budgets, federal inflation data shows.
The U.S. Bureau of Labor Statistics on Thursday released its Consumer Price Index, a key marker of inflation, which showed that CPI rose 0.2% in September.
While inflation rose more than expected last month, the year-over-year inflation of 2.4% in this latest data is much lower than the major spike in inflation in recent years.
The data comes after the U.S. Federal Reserve announced an interest rate cut last month, a sign that the Fed believes inflation is under control enough to lower rates, and thereby boost the economy.
“Disinflation continues, but anyone who thought the Fed was going to lower rates by another .50 basis points in November is dead wrong,” Jamie Cox, managing partner at Harris Financial Group in Richmond, said in a statement. “When interest rates aren’t high enough to lower growth, they aren’t high enough to stifle inflation completely either. The Fed will lower rates, but at a measured pace from here.”
Much of the increase was driven by an increase in rent costs.
The data also showed a jump in food prices of 0.4%, the biggest increase since January of this year.
“Five of the six major grocery store food group indexes increased over the month,” BLS said. “The index for meats, poultry, fish, and eggs rose 0.8 percent in September as the index for eggs increased 8.4 percent. The fruits and vegetables index increased 0.9 percent over the month, following a 0.2-percent decline in August. The index for other food at home rose 0.2 percent in September and the index for cereals and bakery products increased 0.3 percent. The dairy and related products index increased 0.1 percent over the month, while the nonalcoholic beverages index was unchanged in September.”
Eating out became 3.9% more expensive in the last year.
Meanwhile, experts say the deadly hurricanes hitting the U.S. right now are impacting the job market.
“Initial jobless claims jumped to 258,000 in the week ending October 5, above the 230,000 consensus forecast or Comerica’s forecast of 250,000,” Bill Adams, Chief Economist for Comerica Bank “This is the first claims report showing the impact of Hurricane Helene, which made landfall on September 26.”
