High gasoline prices expected to boost US consumer inflation in September
TLT•US consumer prices were forecast to rise 0.6% in September, up from 0.4% in August, as gasoline and food costs increased. Core CPI was expected to rise 0.2%, while the report will help determine the 2027 Social Security cost-of-living adjustment.
1. Headline inflation forecast to rise
The Consumer Price Index was forecast to increase 0.6% in September after rising 0.4% in August, according to a survey of economists. Gasoline prices rose 7.1% during the month, and food prices were expected to increase at least 0.2%. The year-over-year CPI rate was forecast to reach 3.6%, from 3.4% in August.
2. Core inflation expected to ease
Excluding food and energy, CPI was forecast to rise 0.2% in September, down from 0.3% in August, while the annual core rate was expected to edge up to 2.5% from 2.4%. Economists cited rising jet fuel costs and possible price increases from record-high diesel prices, while rents were expected to rise moderately.
3. Report informs benefit adjustment
The September report will be used in calculating the 2027 cost-of-living adjustment for Social Security and Supplemental Security Income. The Senior Citizens League projected a 3.5% increase, which would raise the average monthly retirement benefit by $67.90 to $2,007. The report was also expected to factor into the Federal Reserve’s rate deliberations; markets assigned about a 22% chance of an October hike.
