Newzinflation accelerated last month as gasoline and many other goods and services became more expensive, evidence that rising prices remain an economic challenge just a few weeks before midterm elections that have focused heavily on affordability.The consumer price index rose 3.7% in September compared with a year ago, the Labor Department said Wednesday, up from 3.4% in August. On a monthly basis, costs jumped 0.6% from August to September, the biggest gain in five months, up from a 0.4% increase the previous month.The figures underscore the lingering impact of the Iran war on gas prices and the stubborn persistence of inflation, which has ticked higher since the war began in late February. The rise isn't all linked to oil and gas, as surging investment in data centers and AI has also pushed up prices for computer chips and the consumer electronics that use them.
Elevated inflation has posed political problems for Republicans in Congress and is a challenge for the Federal Reserve, which is required by Congress to seek stable prices.Excluding the volatile food and energy categories, core prices rose 2.6% in September from a year ago, up from 2.4% the previous month and higher than economists had expected. And they climbed 0.3% from August to September, an elevated pace that, if it continued for a year, would run well above the Fed's 2% target.Higher inflation will likely put more pressure on the Fed to lift its key interest rate at its next meeting Oct. Economists noted that the report showed price increases were spread more broadly across the economy than in recent months.“The report was worse than expected,” Bill Adams, chief U.S.
economist at Fifth Third Bank, said in a note to clients. “Price increases were widespread .... Consumer demand seems to be holding up better than the downbeat consumer surveys would suggest, helping businesses maintain pricing power."Wednesday's figures are the last major inflation data to be released before the upcoming elections.
Ongoing inflation has taken a toll on Trump’s standing with U.S. A poll by The Associated Press-NORC Center for Public Affairs Research found that just 17% of U.S. adults approve of his handling of the cost of living issue.
And only 26% approve of his handling of the economy overall, a new low.Gas prices jumped 9.1% just from August to September, the government's co… inflation accelerated last month as gas, clothes, and air fares got more expensive, evidence that rising prices remain an economic challenge just a few weeks before the midterm elections that have focused heavily on issues related to affordability.The consumer price index rose 3.7% in September compared with a year ago, the Labor Department said Wednesday, up from 3.4% in August. The rise isn't all linked to gas prices, as surging investment in data centers and AI has also pushed up prices for computer chips and the consumer electronics that also use them.
And only 26% approve of his handling of the economy overall, a new low.Federal Reserve officials are watching inflation data closely to determine whether they need to raise their short-term interest rate further, and by how much.Fed Chairman Kevin Warsh said last month that inflation isn't moving quickly enough back to the central bank's target, causing the Fed to hike rates for the first time in three years, to about 3.9%.Yet some key Fed officials have suggested the central bank can wait before increasing rates again. 27-28, but most Wall Street investors expect it to hold rates then, and potentially implement another hike in December. Fed officials have penciled in just one more rate hike this year.By raising borrow…
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