US consumer prices up slight 0.1 per cent in September

WASHINGTON — Consumer prices edged up a slight 0.1 per cent in September as energy prices retreated after a big gain in August.

The Labor Department said Thursday that the September gain in its closely watched consumer price index followed a 0.2 per cent rise in August. It was the smallest monthly gain since June.

article continues below

Inflation has been on a slight rise this year after a prolonged stretch when prices kept falling below the 2 per cent target set by the Federal Reserve. For the 12 months ending in September, consumer prices were up 2.3 per cent.

Core inflation, which excludes volatile energy and food costs, rose 0.1 per cent in September, the same level as in August. It is up 2.2 per cent over the past year.

The Federal Reserve has raised interest rates three times this year and signalled that it will raise rates one more time in 2018 in an effort to make sure that a strong economy and low unemployment do not trigger an unwanted rise in inflation. The jobless rate fell to a 49-year low of 3.7 per cent in September.

But President Donald Trump has stepped up his criticism of the Fed's rate hikes, calling them unwarranted. Rising interest rates were one of the factors blamed for the big sell-off on Wall Street this week.

Trump, who has often pointed to the stock market surge as evidence that his economic policies are working, said Wednesday that the Fed had "gone crazy" raising short-term interest rates.

"The Fed is making a mistake. They're so tight," Trump told reporters before a campaign rally in Pennsylvania on Wednesday evening.

It marked Trump's latest attack in a string of criticism that began in the summer. Fed Chairman Jerome Powell, who took over the top Fed job in February, has not responded directly to Trump's attacks other than to say that the central bank believed its policy of gradual rate increases marked the best approach to extending the current recovery and making sure inflation does not become a problem.

So far, inflation, while higher than it has been, is remaining close to the Fed's target of 2 per cent annual price increases. But some economists worry that with labour markets so tight, wage gains will start to accelerate, forcing businesses to charge more for their products.

For September, energy prices fell 0.5 per cent after a 1.9 per cent surge in August. Food costs were flat in September after a tiny 0.1 per cent rise in August.

The Social Security Administration announced that millions of recipients of Social Security and other government benefits will receive a 2.8 per cent increase in their monthly payments starting in January. That will be the biggest cost-of-living increase in seven years. The adjustment is based on the third quarter average for consumer prices this year compared to the third quarter of 2017.

© Copyright 2018 Estevan Mercury

Physician POLL

Do you believe Estevan now has a sufficient number of physicians?

or  view results

Alice Cooper in Estevan 2018
City of Estevan presents:
JOHN MELLENCAMP
Sign Up for Our Newsletter!

Popular Estevan News

Community Event Calendar


Find out what's happening in your community and submit your own local events.