October Fed Meeting: Live Updates and Commentary

The September Consumer Price Index showed that President Donald Trump’s tariff policies have had a muted impact on cost pressures – and all but guarantees the Federal Reserve will lower the federal funds rate on Wednesday afternoon.

According to the Bureau of Labor Statistics, headline CPI was up 0.3% month over month in September, slower than the 0.4% rise seen in August and the 0.4% increase economists expected.

The CPI was 3.0% higher year over year, a quicker pace than the month prior. Still, the results arrived below the 3.1% increase economists anticipated.

Gas prices were the biggest contributor to the increase in headline CPI, surging 4.1% from August to September. Food costs were also up last month, rising 0.2%.

Core CPI, which excludes volatile food and energy prices and is seen as a better measure of underlying inflation trends, rose 0.2% month over month and 3.0% year over year – coming in below August’s figures and economists’ forecasts.

“Inflation might not be slowing, but it’s not surprising to the upside anymore,” says David Russell, global head of market strategy at TradeStation. “The details are positive, with shelter and transportation services moderating. Some key parts of the basket are cooling even if tariffs nudge items like apparel higher.”

Russell adds that the September CPI report keeps the Fed on track to cut rates by a quarter-percentage point at next week’s meeting, and will likely have policymakers striking a more dovish stance moving forward.

While delayed from its originally scheduled October 15 reporting date, the BLS released today’s data so that the Social Security Administration could calculate the cost-of-living adjustment (COLA). But with data collection services still suspended, it’s unclear when we’ll see the next CPI report.

– Karee Venema