Economy & Business

Prices Jumped 5.4 Percent in September over Last Year

Doug Hassebroek picks up an item at the grocery store, separated from cashiers by sheets of plexiglass during the coronavirus outbreak in Brooklyn, N.Y., March 28, 2020. (Caitlin Ochs/Reuters)

Consumer prices rose 5.4 percent in September compared with a year ago and 0.4 percent from the month before, according to data released Wednesday by the Labor Department. 

The rise was slightly higher than experts expected as economists surveyed by Dow Jones predicted a 5.3 percent year-over-year increase in September and a monthly increase of 0.3 percent in the Consumer Price Index, which tracks inflation.

While the monthly increase was below the 0.9 percent spike seen in June, it still suggests inflation has yet to slow down.

The increase was largely due to a jump in food and energy prices, which are typically more volatile.

Food prices rose 0.9 percent while gasoline jumped 3.9 percent and new vehicles rose by 1.3 percent.

Meanwhile, the core consumer price index, which excludes volatile food and energy costs, rose 4 percent from a year ago. The index saw a 0.2 percent increase last month, in line with expectations.

The latest report comes after August saw a 5.3 percent year-over-year rise in prices and June and July each saw a similar 5.4 percent increase, the largest 12-month rise since August 2008.

COVID-19 concerns and labor shortages have snarled supply chains as the pandemic has worn on, leaving inflation reaching decades-plus highs for much of the last year.

Leaders at the Federal Reserve have said the price increases are transitory, arguing that as supply chains mend, inflation will fall closer to its 2 percent annual target, sometime next year.

Meanwhile, Treasury Secretary Janet Yellen on Tuesday sought to reassure Americans that they should not be concerned about the “absence of goods” around Christmas and the holidays.

“There may be isolated shortages of goods and services in the coming months,” Yellen said in an interview with CBS that aired on Tuesday night. “But there is an ample supply of goods. I think there’s no reason for consumers to panic about the absence of goods that they’re going to want to acquire at Christmas.”

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