September CPI: Inflation comes in lower than expected but holds firm near 3%

Core Inflation Data - Inflation held steady at 3% in September, slightly below analysts' expectations of 3.1% [2][8] - The Consumer Price Index (CPI) rose 3% year over year in September, up from 2.9% in August, marking the highest reading since May [2][3] - Month-over-month prices increased by 0.3%, lower than August's 0.4% rise and below economists' expectations [3][4] Energy Prices Impact - Gasoline prices rose by 4.1% in September, contributing to the monthly price increase, but were down 0.5% year over year [3] - The broader energy commodities index decreased by 0.4% compared to the previous year [3] Core Inflation Insights - Core inflation, excluding food and energy, rose 3% year over year in September, down from 3.1% in August [4] - On a monthly basis, core prices increased by 0.2%, easing from a 0.3% gain in August [4] Economic Context - The report was the first major piece of federal economic data released since the ongoing government shutdown, which is now the second-longest in US history [5][6] - RSM chief economist noted the report as a "market positive story," but warned about potential data quality deterioration due to the shutdown [6][7] Future Outlook - The current inflation rate of 3% is expected to potentially accelerate, remaining above the Federal Reserve's target of 2% [8] - Markets anticipate a quarter-point cut from the Fed at the upcoming policy meeting, despite persistent inflation [8]