Price inflation continued to be a sticky problem for U.S. consumers and businesses in September as the consumer price index (CPI) increased 0.4 percent month-over-month (MoM) and 3.7 percent year-over-year (YoY), according to a Labor Department report on Thursday.
The year-over-year CPI matched the August trend line and came in hotter than Dow Jones estimates for 0.3 percent MoM and 3.6 percent YoY. The September MoM number improved from the 0.6 percent month-over-month increase in August. The 3.7 percent increase for the year is on top of an 8.2 percent increase in September last year.
The CPI is the price consumers pay for a wide variety of goods and services.
The index for Shelter was reportedly the largest contributor to the MoM of all items increase, accounting for over half of the increase. An increase in the Gasoline ndex was also a major contributor to the All Items MoM rise.
Excluding volatile food and energy prices, the so-core CPI increased 0.3 percent MoM and 4.1 percent YoY, both in line with expectations. Policymakers place more weight on the core numbers as they tend to be better predictors of long-term trends.
One bright spot for consumers was in the month-over-month CPI for Apparel, which declined 0.8 percent from August, most likely due to the de-stocking and promotional environment at retailers. The year-over-year CPI for Apparel was up 2.5 percent in September.
Real average hourly earnings fell 0.2 percent on the month, owing to the difference between the inflation rate and the 0.2 percent gain in nominal earnings, the Labor Department said in a separate report. On a yearly basis, earnings were up 0.5 percent.
In other economic news, the Labor Department reported Thursday that initial jobless claims totaled 209,000, unchanged from the previous week and just below the 210,000 estimate.
