Inflation Soars to 2.4% in September: Food and Shelter Costs Drive the Surge

Written by Sun Yulin

October 10, 2024

Inflation in the United States rose to 2.4% in September, according to the latest report from the Bureau of Labor Statistics (BLS). This figure represents a 0.2% increase in the consumer price index (CPI) for the month, slightly surpassing the Dow Jones consensus forecast by 0.1 percentage points. While this marks a notable rise, it also reflects a decrease of 0.1 percentage points compared to August, making it the lowest annual inflation rate since February 2021.

The CPI is a broad measure that tracks the costs of goods and services across the U.S. economy, and the recent increase has been driven largely by rising food and shelter prices. Food prices jumped by 0.4% during the month, while shelter costs also contributed with a 0.2% gain. Together, these two categories accounted for more than three-quarters of the inflation uptick. In contrast, energy prices experienced a significant decline, falling by 1.9%, which helped to mitigate the overall inflation rate.

Core prices, which exclude the often-volatile food and energy sectors, rose by 0.3% in September, resulting in an annual rate of 3.3%. This core inflation reading also came in 0.1 percentage points above analysts’ expectations, indicating persistent price pressures in other sectors. Notably, medical care services saw an increase of 0.7%, and apparel prices surged by 1.1%, highlighting areas where consumers are facing rising costs.

In addition to these inflationary trends, a separate report revealed that weekly jobless claims have reached a 14-month high, suggesting potential softness in the labor market. This comes despite the robust increase in nonfarm payrolls observed in September. Analysts have noted that much of the recent surge in jobless claims may be tied to temporary factors, such as disruptions caused by hurricanes and labor strikes.

As policymakers continue to monitor inflation and employment trends, the September data adds complexity to the economic landscape. The interplay between rising prices and potential labor market weaknesses will be crucial in shaping future economic policy decisions. For consumers, the higher inflation rate means careful budgeting will be essential as they navigate rising costs for essential goods and services in the months ahead.

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