Soaring gas prices are pushing inflation higher

The Consumer Price Index rose 0.6% on a seasonally adjusted basis in September, the Bureau of Labor Statistics reported Wednesday, driven largely by a surge in gasoline prices that pushed the annual inflation rate to 3.7%.

Gasoline prices climbed 9.1% over the month, accounting for more than half of the overall monthly increase, according to the BLS. Over the past 12 months, gasoline is up 34.2%. September's energy index advanced 5.2%, following a 2.1% increase in August, and has climbed 20.4% compared with a year earlier.

The all-items index rose 3.7% for the 12 months ending in September, up from the 3.4% annual rate reported for August.

Core CPI, which strips out food and energy, came in at 0.3% for September and 2.6% year over year — both figures topping the 0.2% monthly and 2.5% annual readings economists had forecast, according to the Wall Street Journal and CNBC.

Food prices were unchanged in September after rising 0.1% in each of the two preceding months, the BLS said. The food-at-home index slipped 0.1%, pulled down by lower prices for meats, poultry, fish, and eggs, along with dairy and related products. The food-away-from-home index rose 0.2% for the month and is up 3.5% over the past year.

Within the core index, the shelter index increased 0.4%, owners' equivalent rent rose 0.3%, and rent increased 0.2%. The used cars and trucks index gained 0.7%, airline fares rose 1.2%, and the recreation index climbed 0.5%. The communication index declined 0.2%.

Stock futures fell into negative territory following the release, while Treasury yields moved higher.

At its September meeting, the Federal Reserve under Chairman Kevin Warsh approved an interest rate increase — its first in over three years — bringing the target range for the benchmark funds rate to 3.75%–4%, according to CNBC. The majority of policymakers at that gathering signaled they expected a single additional rate hike before year's end. The central bank's next scheduled meeting falls on Oct. 27–28, and market participants broadly anticipate no action at that gathering, with a possible increase coming in December, according to CNBC.

The BLS noted that data for October and November 2025 are unavailable due to a lapse in appropriations that year. The next CPI release, covering October 2026, is scheduled for Tuesday, Nov. 10, 2026.