Consumer prices rose 2.4% in September

The prices of most goods and services ticked higher in September. The Consumer Price Index (CPI) was up 2.4% from the year-ago period, according to Thursday’s (Oct. 10) report from the U.S. Bureau of Labor Statistics (BLS).

When subtracting food and energy the index rose 3.3% over the last 12 months. While energy costs overall declined 6.8% with lower gasoline and fuel prices, food prices rose 2.3%, the BLS noted.

Economists at Wells Fargo Securities said the inflation number was warm, not hot and most likely tied to economic growth. The September report indicated inflation ticked down from the previous month, but not as much as economists had forecast. Gregory Daco, chief economist of EY, said consumer prudence, increased price sensitivity, reduced markups, and moderating wage growth should result in disinflationary conditions heading into 2025.

Grocery prices for food consumed at home rose 1.3% overall compared to a year ago. Meat, poultry, fish and egg prices increased an average of 3.9% from the year-ago period, the BLS reported.

Retail beef prices averaged around $8.50 per pound in September, outpacing the $8 per pound reported a year ago, and the $7.25 per pound averaged for the past five years. Beef prices are expected to remain high given fewer heads of cattle slaughtered, Stephens Inc. reports.

BLS reports the prices of cereals, dairy, fruits and vegetables as well as non-alcoholic beverages were all higher in September than a year ago. While grocery prices remain elevated, restaurant prices also rose 3.9% from a year ago amid high labor and food ingredient costs.

Costs around paying for shelter continue to escalate with rents rising 4.8% from a year ago and homeowner costs ticked up 5.2%. This index remains elevated because of rising rents and higher insurance costs and elevated interest rates for those acquiring property.

The cost of owning an automobile is also increasing despite car and truck prices coming down from a year ago. Insurance costs are up 16.3% and repair and maintenance costs remain 4.9% higher year over year, BLS reports.

Medical care costs also ticked higher in September with physician services up 1.5% and hospital costs rising 4.5%. Prescriptions were 2.2% more expensive while medical supply costs rose 1.6% from a year ago., BLS reports.

Costs around travel also remain more expensive with airfares rising 1.6%, on top of a 3.9% hike in August and a 3.2% increase in July. Lodging costs have started to come down falling 2.8% in September and declining 1.9% in August. Before that, lodging costs rose 2% in June and July.