US Inflation Slows to 2.4% in September, Strengthening Fed Cut Bets
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US consumer inflation cooled more than expected in September, reinforcing signs that price pressures continue to ease and increasing the likelihood of a Federal Reserve rate cut next month. The Consumer Price Index rose 2.4% from a year earlier, down from August and the lowest reading since February 2021. Economists had expected a 2.6% increase.
On a monthly basis, prices also showed a softer pace of growth, suggesting that the disinflation trend remains intact even as parts of the economy continue to face elevated costs. Core CPI, which excludes food and energy and is closely watched by policymakers, increased 3.3% year over year. That was also below forecasts, offering further evidence that underlying inflation is moderating.
The report is likely to bolster market expectations that the Federal Reserve will move to cut interest rates at its November meeting, especially as officials weigh signs of cooling inflation against the need to support economic growth. While the central bank has emphasized that it wants more confidence inflation is moving sustainably toward its 2% target, September’s data adds to the case that price gains are gradually normalizing.
