Input Stories

Inflation cooled in September, but not as quickly as economists had anticipated (The Associated Press).

What’s going on: “The consumer-price index rose 2.4% from a year earlier in September, the Labor Department said Thursday, after rising 2.5% in August. That was higher than the 2.3% rise that economists polled by The Wall Street Journal had expected.”

• “Core” CPI, which excludes food and energy costs, rose 3.3% in the previous 12 months, also above economists’ expectations.

What it means: “On the one hand, the inflation rate has fallen back to where it was right after President Biden took office. But lower inflation readings, which typically measure the 12-month change in prices, haven’t been greeted warmly by many Americans because the prices of everything from groceries and restaurant meals to housing and insurance remain much higher than they were four years ago.”

Why it happened: Food prices in September posted their biggest monthly gain since January and the cost of clothing, car insurance and airfare rose significantly, too.

The bigger picture: The CPI data comes less than a month after the Federal Reserve cut its benchmark interest rate by half a percentage point, and less than a week after a mostly positive nonfarm payroll employment report.

However … Manufacturing jobs declined by 7,000 in September (Bureau of Labor Statistics). And “[i]n remarks this week, a slew of Fed officials have said they’re still willing to keep cutting their key rate but at a deliberate pace, a signal that any further half-point cuts are unlikely” (The Associated Press).