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The US Labor Department released consumer inflation figures for September, showing that the cost of living for American consumers rose 0.6% from the previous month. On an annual basis, the Consumer Price Index climbed 3.7%, above the 3.6% economists had projected and the highest reading since May. In August, the annual rate had stood at 3.4%.

Gasoline was a major driver of the monthly increase, with its index jumping 9.1% and accounting for more than half of the overall monthly gain. The gasoline index was up 34.2% year on year. The energy index rose 5.2% monthly after a 2.1% increase in August and posted a 20.4% annual gain, while the shelter index edged up 0.4% monthly and 3.2% annually. Food prices were unchanged on the month but 2.5% higher than a year earlier.

Core inflation, which strips out volatile energy and food costs, rose 0.3% monthly and 2.6% annually, also exceeding forecasts of 0.2% and 2.5%. In August, core prices had increased 0.3% on a monthly basis and 2.4% on an annual one.

Key Takeaways

• US consumer prices rose 0.6% in September and 3.7% year on year, above the 3.6% forecast
• Gasoline prices surged 9.1% monthly, driving more than half of the overall increase
• Core inflation climbed 0.3% monthly and 2.6% annually, beating market expectations