Inflation ticked up in September with the cost of goods up 0.4 percent over August according to the Consumer Price Index (CPI) report released by the Bureau of Labor Statistics (BLS). Overall prices were up 3.7 percent compared to this time last year, slightly higher than the 3.6 percent forecasted. The increase in inflation was driven primarily by increasing costs for food and housing.
Heritage Foundation economist E.J. Antoni says that because of high inflation, the typical American family is now $7,300 poorer than they were in January of 2021. Antoni also notes that the average American worker is now paying more in the hidden tax of inflation than they are federal income taxes.
September’s CPI report also suggests that the Federal Reserve is a long way off from its 2 percent inflation target. The annualized trend since June 2022 remains elevated at above 3 percent with no signs of decelerating.
Opinions remain mixed on whether the new CPI data will push the Federal Reserve to institute another interest rate hike before the end of the year. Antoni believes the Federal Reserve will raise rates by 25bps at their next meeting. Jason Furman, who served as the chair of the Council of Economic Advisors during the Obama administration, says the September inflation number “Doesn’t come close to the bar for a hike in November.”
