The latest data from the U.S. Bureau of Labor Statistics (BLS) shows consumer prices rose 0.3% in September, a slight moderation from August’s 0.4% gain, signaling steady but contained inflationary pressures heading into Q4.
Gasoline Drives Monthly Gains
Energy costs were the biggest contributor to the monthly increase, with gasoline prices up 4.1%, pushing the broader energy index 1.5% higher. Electricity and natural gas, however, fell 0.5% and 1.2%, respectively. Over the past year, the energy index has risen 2.8%, led by an 11.7% surge in natural gas and 5.1% in electricity.
Food Inflation Eases, Shelter Stays Firm
The food index climbed 0.2% in September after a stronger August reading. Prices for groceries rose 0.3%, driven by higher costs for cereals, bakery products, and nonalcoholic beverages. Restaurant meals increased only 0.1%, suggesting cooling demand in dining services.
The shelter index, a key component of core inflation, advanced 0.2%, while owners’ equivalent rent saw its smallest monthly increase since early 2021. Lodging away from home rose 1.3%, and airline fares jumped 2.7% following a 5.9% rise in August.
Core Inflation Holds Steady at 3.0%
Excluding food and energy, core CPI rose 0.2% in September and 3.0% year-over-year, matching August’s pace. Notable increases were seen in recreation (+0.4%), household furnishings (+0.4%), and apparel (+0.7%). Used car prices fell 0.4%, offsetting gains in new vehicles (+0.2%) and medical care (+0.2%).
Twelve-Month View Shows Balanced Trend
Over the past 12 months, overall consumer prices have climbed 3.0%, only a tick above August’s 2.9% annual rate. Food prices rose 3.1%, energy prices 2.8%, and shelter costs 3.6%. Despite modest gains, the data suggest inflation is gradually stabilizing, giving the Federal Reserve more flexibility as markets anticipate potential rate adjustments later this year.