Consumer prices in the U.S. increased by more than expected in the month of September, according to a highly anticipated report released by the Labor Department on Thursday.
The Labor Department said its consumer price index rose by 0.4 percent in September after inching up by 0.1 percent in August. Economists had expected consumer prices to edge up by 0.2 percent.
The stronger than expected consumer price growth reflected higher prices for shelter, food and medical care, which were partly offset by a continue slump in gasoline prices.
Meanwhile, the report showed the annual rate of growth by consumer prices slowed modestly to 8.2 percent in September from 8.3 percent in August. The pace of growth was expected to decelerate to 8.1 percent.
Excluding food and energy prices, core consumer prices climbed by 0.6 percent for the second straight month compared to expectations for a 0.5 percent advance.
The core price growth reflected the increases in prices for shelter and medical care as well as higher prices for motor vehicle insurance, new vehicles, household furnishings and operations, and education.
The Labor Department noted lower prices for used cars and trucks, apparel, and communication helped limit the upside.
The report also showed the annual rate of growth by core prices accelerated to 6.6 percent from 6.3 percent. Economists had expected the pace of growth to accelerate to 6.5 percent.
The slightly faster than expected core price growth reflected the biggest year-over-year increase since August 1982.
“The disappointingly broad-based and high inflation readings will keep the Fed in an aggressive tightening mode and on course for at least another 125bps this year,” said Kathy Bostjancic, Chief U.S. Financial Economist at Oxford Economics.
On Wednesday, the Labor Department released a separate report showing U.S. producer prices also increased by more than expected in the month of September.
The Labor Department said its producer price index for final demand climbed by 0.4 percent in September after dipping by 0.2 percent in August. Economist had expected producer prices to edge up by 0.2 percent.
Meanwhile, the report showed the annual rate of producer prices growth slowed to 8.5 percent in September from 8.7 percent in August. The pace of growth was expected to decelerate to 8.4 percent.
For comments and feedback contact: editorial@rttnews.com
Economic News
What parts of the world are seeing the best (and worst) economic performances lately? Click here to check out our Econ Scorecard and find out! See up-to-the-moment rankings for the best and worst performers in GDP, unemployment rate, inflation and much more.
