The Consumer Price Index for All Urban Consumers (CPI-U) rose 0.4 percent in September on a
seasonally adjusted basis, after increasing 0.6 percent in August, the U.S. Bureau of Labor Statistics
reported today. Over the last 12 months, the all items index increased 3.7 percent before seasonal
adjustment.

The index for shelter was the largest contributor to the monthly all items increase, accounting for over
half of the increase. An increase in the gasoline index was also a major contributor to the all items
monthly rise. While the major energy component indexes were mixed in September, the energy index
rose 1.5 percent over the month. The food index increased 0.2 percent in September, as it did in the
previous two months. The index for food at home increased 0.1 percent over the month while the index
for food away from home rose 0.4 percent.

The index for all items less food and energy rose 0.3 percent in September, the same increase as in
August. Indexes which increased in September include rent, owners’ equivalent rent, lodging away from home, motor vehicle insurance, recreation, personal care, and new vehicles. The indexes for used cars and trucks and for apparel were among those that decreased over the month.

[The takeaway here is that the rate of inflation isn’t lessening, and the compounding effect makes this even worse than it looks. Gas prices continued to spike sharply upward in September even on top of the massive spike in August, and fuel oil is spiking even harder. Shelter (rent and house payments) is rising faster than overall inflation at 0.6%, a continuing trend that is having an outsize impact on wage erosion for working Americans. This is not good news by any means; we’ll see what the Fed does when the PCE inflation index comes out later this month. — Ed]