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Accessibility statementSkip to main content Democracy Dies in Darkness SubscribeSign in Democracy Dies in Darkness BusinessEconomyEconomic PolicyPersonal FinanceWorkTechnologyBusiness of Climate BusinessEconomyEconomic PolicyPersonal FinanceWorkTechnologyBusiness of Climate INFLATION EASED SLIGHTLY IN SEPTEMBER, AS ELECTION NEARS Prices showed more cooling in the latest consumer price index, but not as much progress as economists hoped for. 4 min New! Catch up quickly with key takeaways Close alert banner 1263 A person shops for groceries in San Rafael, Calif., last month. (Justin Sullivan/Getty Images) By Andrew Ackerman Updated October 10, 2024 at 12:20 p.m. EDT|Published October 10, 2024 at 6:00 a.m. EDT Inflation continued to cool in September, extending a trend of easing price increases and an improving economy that has yet to convince many Americans, with the election nearing. The consumer price index fell slightly to 2.4 percent in September from a year earlier, according to the Labor Department, missing economists’ expectations because of less progress on food prices. Still, the annual rate hasn’t been this low since Feb. 2021. Get a curated selection of 10 of our best stories in your inbox every weekend. Thursday’s figures represent “the best inflation outlook in the economy over the past three years,” said Joe Brusuelas, chief economist at RSM US. Prices grew by just 0.2 percent between August and September, which was the same pace as a month earlier. Story continues below advertisement The bulk of September’s monthly increase was driven by a rise in prices for housing and food, which increased by 0.2 percent and 0.4 percent, respectively. Energy prices fell 1.9 percent over the month, driven by a decrease in gas prices. Prices for used cars and trucks dropped 5.1 percent for the year but increased 0.3 percent on a monthly basis in September after three months of declining prices. Advertisement The September consumer price index report is the last before the Nov. 5 presidential election and the Federal Reserve’s next policy meeting Nov. 6-7 and is expected to weigh on policymakers’ rate-cutting decisions. U.S. stock indexes declined after the release of Thursday’s report before recovering their losses. Story continues below advertisement Inflation has steadily fallen since peaking at an annual rate of 9.1 percent two years ago. Still, a long stretch of sharp increases has left prices much higher than before the coronavirus pandemic, leaving scores of households and businesses with the feeling that the economy isn’t working for them. In polls, U.S. voters rank the economy as the most important issue in their choice for president. The economy is the only issue on which a majority of voters, 52 percent, say the candidates’ positions are an “extremely important” factor in their vote, according to Gallup poll conducted last month. Advertisement Thursday’s figures show continued progress tackling rising prices, with inflation returning to pre-pandemic levels, said Lael Brainard, President Joe Biden’s top economic adviser, in a statement. Story continues below advertisement In the run-up to the election, Vice President Kamala Harris and former president Donald Trump are pitching voters on their plans to lower prices, including for housing and other everyday costs. Some economists fear that the candidates’ policies could exacerbate inflation, especially if Trump returns to the White House and carries out his pledges for mass deportations and high tariffs. Share this articleShare Harris’s plans to improve the availability of housing through tax credits and other incentives could also push prices upward, though the campaign also talks about building homes to address long-standing shortages. Core prices, which exclude more volatile food and energy components, rose 3.3 percent annually, slightly faster than in August and also more than economists expected. Nearly two-thirds of that core figure was driven by a 4.9 percent rise in housing prices, though housing price increases eased on a monthly basis. Advertisement Story continues below advertisement Meanwhile, car insurance rose 16.3 percent over the past year, medical care increased by 3.3 percent, and personal care increased 2.5 percent. Apparel prices also rose 1.8 percent. Transportation, which includes new vehicles and used cars and trucks, increased 1.4 percent on a monthly basis. Airfares also rose 3.2 percent. Economists said monthly data might be uneven as the Fed makes progress on tackling inflation. Not every month will necessarily show a decline, said Skanda Amarnath, executive director of Employ America, a liberal think tank. “We should still expect a lot of bumps in the road, and this will not be a linear process all the way to 2 percent,” he said, referring to the Fed’s inflation target. Story continues below advertisement Economic data released since the Fed ratcheted down interest rates last month demonstrates that the labor market remains solid. The Labor Department had reported Friday that U.S. employers added 254,000 jobs and the unemployment rate ticked down to 4.1 percent in September. Advertisement On Thursday, initial claims for jobless benefits spiked to 258,000 for the week ending Oct. 5, the highest level going back to August 2023. But the figures may have been influenced by those affected by Hurricane Helene. Damage caused by two major hurricanes, Helene and Milton, could likely distort more economic data in the near term, Brusuelas said. The Fed’s benchmark rate now sits between 4.75 and 5 percent, up from near-zero rates during the pandemic. Investors in interest-rate-futures markets expect the Fed will cut rates again at its November meeting. They see a nearly 90 percent chance that the Fed cuts rates by a quarter-percentage point as of Thursday morning, according to CME Group. Share 1263 Comments NewsletterWednesdays The Color of Money Advice on how to save, spend and talk about your money for the short and long term from Michelle Singletary. Sign up Subscribe to comment and get the full experience. 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