CPI inflation report September 2026

Key Points:

• In September, U.S. consumer prices rose 0.6% monthly, pushing the annual inflation rate to 3.7%, above the Federal Reserve's 2% target, driven largely by surging energy costs amid ongoing U.S.-Iran tensions.
• Core CPI, which excludes volatile food and energy prices, increased 0.3% for the month and 2.6% annually, both slightly higher than economists' expectations.
• Gasoline prices surged 9.1% in September, contributing about half of the overall CPI increase, with a 34.2% rise over the past year, while shelter and used vehicle prices also saw notable increases.
• Market reactions included falling stock futures and rising bond yields, with futures traders raising the likelihood of a Federal Reserve interest rate hike at the upcoming October meeting to 44%, and over 96% odds of a hike before year's end.
• Despite recent rate hikes and inflation moderation, Fed officials remain cautious about persistent inflation pressures, particularly from energy shocks, and anticipate further rate increases in 2024 to prevent inflation from becoming entrenched.