US inflation picks up in September

U.S. consumer prices rose more quickly in September 2026, with the Consumer Price Index for All Urban Consumers up 0.6% on a seasonally adjusted basis from August. Over the past 12 months, the all-items index increased 3.7% on an unadjusted basis, underscoring that inflation remains above the pace targeted by many policymakers. The monthly gain was larger than in August and marked one of the stronger increases in recent months.

Stripping out the more volatile food and energy categories, the index for all items less food and energy rose 0.3% in September. On a 12‑month basis, this core CPI measure was up 2.6%, pointing to continued underlying price pressures even when energy swings are excluded.

Energy played a central role in the September inflation pickup. The gasoline index climbed 9.1% over the month, accounting for more than half of the overall monthly increase in the CPI. On a year‑over‑year basis, gasoline prices were 34.2% higher, illustrating the sharp rise in fuel costs facing consumers.

The broader energy index increased 5.2% in September and 20.4% over the 12 months ending in the month, reflecting elevated prices across several energy components. These moves helped push headline inflation higher even as some other categories showed more moderate changes.

Shelter costs also contributed to inflation in September. The shelter index rose 0.4% after a 0.3% increase in August, while owners’ equivalent rent advanced 0.3% and rent of primary residence increased 0.2% for the month. These housing‑related components are significant within core CPI and tend to adjust more slowly than energy prices.

Beyond housing and energy, coverage of the report highlighted broad-based price increases in areas such as recreation, used vehicles, airfares and medical care. These gains suggest that inflation pressures were not confined to a single sector, even though energy made an outsized contribution to the overall monthly change.

Higher prices continued to outpace wage gains in September. Data on real average hourly earnings showed a 0.5% decrease for the month, indicating that, after adjusting for inflation, workers’ paychecks bought less than in August. This decline in real earnings underscores the strain that persistent price increases place on household budgets.

Financial markets reacted quickly to the inflation figures. Government bond yields rose, stock prices fell and the dollar strengthened in trading after the release. Market-implied probabilities of an interest-rate hike at upcoming policy meetings moved higher, reflecting expectations that the inflation backdrop could prompt a firmer stance on monetary policy.