The annual inflation rate in the United States rose to 3.7% in September 2026, surpassing market expectations of 3.6%, driven by rising fuel and energy prices, in a development that increases pressure on the U.S. Federal Reserve regarding the path of interest rates in the upcoming phase.
Reuters reported, citing data from the Labor Department's Bureau of Labor Statistics, that the "Consumer Price Index rose by 0.6% in September, compared to an increase of 0.4% in August, while annual inflation accelerated to 3.7%, up from 3.4% in the previous month."
It added that "the annual reading was higher than economists' expectations, surveyed by Reuters, which stood at 3.6%, while the monthly increase matched expectations at 0.6%."
Official data showed that "gasoline prices recorded an increase of 9.1% in September, contributing to more than half of the monthly increase in the Consumer Price Index, while the energy price index increased by 5.2% compared to the previous month and by 20.4% on an annual basis."
It pointed out that "gasoline prices rose by 34.2% on an annual basis, while housing costs increased by 0.4% in September, compared to 0.3% in August, while food prices remained stable on a monthly basis, recording an annual increase of 2.5%."
Regarding core inflation, which excludes more volatile food and energy prices, data indicated that "it rose by 0.3% on a monthly basis, while its annual rate accelerated to 2.6%, compared to 2.4% in August, reflecting ongoing price pressures outside the energy sector."
Monthly increases included airfares by 1.2%, used cars by 0.7%, education by 0.6%, as well as rising costs of medical services, clothing, and recreational activities.
According to Reuters, "the acceleration of inflation brings the likelihood of interest rate hikes back to the forefront of discussions within the Federal Reserve, after the U.S. central bank raised interest rates by 25 basis points last September, to a range of 3.75% to 4%, in its first increase in three years."
The agency added that "markets were assigning a probability of about 22% for an interest rate hike during the Federal Reserve's scheduled meeting on October 27-28, prior to the release of new inflation data, at a time when monetary policymakers face challenges related to persistently rising prices and slowing job growth."
Economic reports have indicated that "the rise in energy costs, linked to the impacts of the war with Iran and fuel supply disruptions, contributed to increasing inflationary pressures, alongside a decline in the purchasing power of American households, with prices rising at a pace that outstrips wage growth."
It noted that "the new inflation data reflected on financial markets, as U.S. Treasury yields rose and stock index futures fell, amid a reevaluation by investors of the likelihood of continued monetary policy tightening."
These developments come ahead of the U.S. midterm elections scheduled for November 3, as the issue of living costs and prices becomes increasingly important in economic and political discussions within the United States.
The Federal Reserve aims for an inflation rate of 2% based on the Personal Consumption Expenditures Price Index, making the persistence of inflationary pressures a significant factor in monetary policy decisions in the coming months.