Consumer Prices Rise 0.6 Percent in September

The Labor Department reported that, due largely to surging energy prices, consumer prices rose 0.6 percent in September for the second month in a row and inflation is now running at an annual rate of 2.0 percent. 

Following an increase of 9 percent in August, gasoline prices jumped 7 percent last month, however, these gains are somewhat larger than what Americans are actually paying at the pump due to upward seasonal adjustments at this time of the year (i.e., normally, gasoline prices are falling in August and September, so the raw price data is adjusted upward).

Aside from the jump in energy prices that, in recent weeks, has abated, there were few other surprises, as food prices rose 0.1 percent last month and are 1.6 percent higher on a year-over-year basis and medical care services rose 0.4 percent and are 4.4 percent higher than a year ago as shown below.

Shelter costs rose 0.2 percent in September, 2.2 percent higher than last year at this time, and about the only notable item in this category is the cost of water and sewer and trash collection services that rose 5.7 percent from a year ago.