Inflation picked up a bit in September, led by higher food and shelter costs

After declining over the last three months, grocery prices rose in September, accounting for much of the increase in the inflation rate - Photo (c) Franki Chamaki on UnSplash

Car insurance remains a significant pain point for consumers

Inflation in September was a little hotter than expected but in line with readings from previous months. The Labor Department’s Consumer Price Index (CPI) rose 0.2% last month, making the inflation rate for the last 12 months 2.4%.

Food and housing accounted for 75% of the increase. Food prices increased by 0.4% with food consumed at home – mostly a reflection of grocery prices –  jumping 0.4% after being flat in August and rising just 0.1% in July.

Food consumed away from home– mostly a reflection of restaurant menu prices – rose by 0.3%. Grocery prices are up 1.3% over the last 12 months while restaurant prices are nearly 4% higher than in September 2023.

Most grocery categories cost more

At the supermarket, there was a pickup in inflation as nearly every food category cost more. Meat, fish, poultry and eggs registered the largest one-month increase, rising 0.8%. Dairy and dairy-related products rose 0.5%.

The cost of fruits and vegetables declined by 0.2% while the cost of non-alcoholic beverages fell by 0.7%.

The cost of shelter, which includes both rent and home ownership costs – slowed in September, rising just 0.2% over August’s 0.5% and July’s 0.4% increase.

The cost of auto insurance continued to go up last month, rising by 1.2% and is up by 16% over the last 12 months, one of the largest pain points for consumers. 

Used vehicle prices rose 0.3% after declining over the previous three months. New car prices rose by 0.2%.

The cost of medical care rose by 0.7%, led by higher costs for doctors’ fees.

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