Consumer prices rose less than expected in September, government data showed Friday, clearing the path for further rate cuts from the Federal Reserve and suggesting that tariffs are not weighing on household budgets.
The consumer price index increased 0.3 percent last month, down from the 0.4 percent in August. Economists had forecast a 0.4 percent increase.
Compared with a year ago, consumer prices are up 3.0 percent, slightly below the 3.1 percent forecast.
Core prices, a metric that excludes food and energy prices, rose 0.2 percent, below the estimate for 0.3 percent. Over the past 12 months, core prices are up 3.0 percent.
Food inflation, which soared in August, cooled in September. The index for grocery prices climbed 0.3 percent over the month, down from the 0.6 percent increase in August. Compared with a year ago, grocery prices are up 2.7 percent. The prices for dining out rose just 0.1 percent, a slowdown from the 0.3 percent increase in August. Compared with a year ago, restaurant prices are up 3.7 percent.
Energy prices were a major source of inflation in the month, rising 1.5 percent in September and 2.8 percent from a year ago. Gasoline prices climbed 4.1 percent in September but are down 0.5 percent from a year ago.
New vehicle prices rose 0.2 percent in September and are up by a slight 0.8 percent compared with a year ago. Used car prices fell 0.4 percent after climbing in the two months prior. Compared with a year ago, used car prices are up 5.1 percent.
Apparel prices are down 0.1 percent from a year earlier despite climbing 0.7 percent in September.
Core services prices, a measure that excludes energy services, rose 0.2 percent. The annual gain is now at 3.5 percent. Shelter prices, which include rent and an imputed figure for owner-occupied homes, climbed by 0.2 percent and are up 3.6 percent.
The prices of appliances climbed 0.8 percent and are up 1.3 percent from a year ago. Major appliance prices rose 0.4 percent in the month but prices are down 0.6 percent from a year ago. Household furniture prices rose 0.2 percent and are up 3.0 percent from a year ago. Prices of computers and smart home assistants rose 0.2 percent and are down 0.7 percent from a year ago. Smartphone prices fell 2.2 percent, the second straight monthly decline. Compared with a year ago, smartphone prices are down 14.9 percent.
Television prices dropped 1.1 percent and they are down 6.0 percent for the year.
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