US CPI posts biggest annual rise since late 2023, jumps 3.0% over the past year

The CPI jumped 3.0% over the past year, the biggest annual rise since late 2023, according to new data from the U.S. Bureau of Labor Statistics.

The September monthly increase clocked in at 0.3%, down from 0.4% in August, and the data was finalized before the recent government funding deadlock.

The biggest driver? Gasoline with a 4.1% surge in September. That was enough to push the full energy index up 1.5% month-over-month.

Meanwhile, food prices crept up again, rising 0.2%. The food at home index gained 0.3%, and food away from home ticked up 0.1%. Combined, these categories explain most of the increase in the CPI this month.

Energy costs rise as gasoline spikes again

Over the full 12 months through September, energy prices are now up 2.8%. But that hides some chaos under the hood.

Electricity prices jumped 5.1%, and natural gas soared 11.7%. Gasoline? Despite the September bump, it’s actually down 0.5% from this time last year.

Breaking down the food data, four out of six grocery categories climbed in September. Cereals and bakery products jumped 0.7%, matching the nonalcoholic beverages index, which also rose 0.7%.

The meats, poultry, fish, and eggs category added 0.3%, coming after a 1.0% jump in August. But not everything went up: dairy products dropped 0.5%, including a 0.7% slide in cheese, and fruits and vegetables stayed flat.

Year-over-year, the food index is now up 3.1%. Within that, food at home rose 2.7%, and food away from home rose 3.7%. Specific standouts: nonalcoholic beverages are up 5.3%, meat, poultry, fish, and eggs jumped 5.2%, and cereals and bakery goods added 1.6%.

Even fruits and vegetables climbed 1.3%, and dairy squeaked out a 0.7% gain. Dining out is more expensive too, limited service meals rose 3.2%, while full service meals gained 4.2%.

Shelter, airfare, medical care keep monthly CPI elevated

Stripping out food and energy, the core CPI rose 0.2% in September. That follows 0.3% increases in both July and August. Over the past year, this core measure is up 3.0%.

Among the gainers: shelter, airline fares, recreation, household items, and apparel. But motor vehicle insurance, used cars, and communication all dropped.

Rent and owners’ equivalent rent both rose just 0.2% and 0.1%, respectively. That’s the smallest monthly rent jump since January 2021. Lodging away from home added 1.3%. Airfares continued their rebound, climbing 2.7% on top of August’s 5.9% spike.

Recreation and furnishings rose 0.4% each. Apparel was up 0.7%, and personal care added 0.4%. New vehicles rose 0.2%, but used cars fell 0.4%.

On the healthcare front, medical care inched up 0.2%, reversing last month’s 0.2% dip. Hospital services and prescription drugs both increased 0.3%, but dental care fell 0.6%, and physicians’ services slipped 0.1%.

Year-over-year, the shelter index is up 3.6%, medical care climbed 3.3%, household operations rose 4.1%, and used cars and trucks are up 5.1% despite monthly declines.

Looking at alternative indexes, the CPI-W, which tracks wage earners and clerical workers, rose 2.9% over the past year and 0.3% month-over-month.

The C-CPI-U, a chained version of the CPI that adjusts for consumer behavior, also increased 2.9% year-over-year and 0.3% on a monthly basis. The BLS noted that these indexes may still be revised over the next few months.

The smartest crypto minds already read our newsletter. Want in? Join them.