U.
S. consumer inflation rose less than expected in September, setting the stage for an almost inevitable interest rate cut by the Federal Reserve next week to boost the economy amid weak job growth and tariff uncertainty.
The consumer price index (CPI) rose 3% year-on-year after rising 2.9% in August, the Bureau of Labor Statistics (BLS) said on Friday. The growth in September was below the average estimate of 3.1% by economists surveyed by Trading Economics.
Core inflation, which excludes volatility in food and energy prices, rose 3% year-on-year in September, which is also lower than analysts' forecasts of 3.1% growth.
The CME's FedWatch tool, after the publication of the inflation report, showed that the probability that the Federal Reserve will lower its target rate by a quarter point at its next meeting next week is 96.7%. In September, the Fed announced a possible two-quarter point rate cut at the last two meetings this year, and Fed Chairman Jerome Powell recently highlighted the risks of lower employment growth more than concerns about inflation, and also referred to uncertainty about the effects of President Donald Trump's tariff wars.
The BLS, whose head Trump fired in August after reports of a sharp decline in employment, released a report during the government shutdown that banned most government reporting in order to meet social security requirements.
"Inflation in September AGAIN exceeded economists' expectations - prices remained at the same level. stable. The golden age of President Donald Trump has arrived," the White House said in a statement on social media.
The energy index rose 2.8% year-on-year in September, accelerating from 0.2% in August. The gasoline price index fell 0.5% after falling 6.6% a month earlier. The food index rose by 3.1% in September, down from 3.2% in August. The housing construction index grew by 3.6% over the year, unchanged.
Services, excluding energy services, considered as the main indicator, increased by 3.5%, down from 3.6% in August.
On a monthly basis, the consumer price index rose 0.3% in September after rising 0.4% in August and 0.2% in July. Core prices rose 0.2% in September after rising 0.3% in the previous month.
Author: Bob Willis
