Commentary Directory

US CPI: September 2023

Jacob Hess
October 12, 2023


10/12/2023 (September 2023)

+3.7% YoY (+0.4% MoM)


Link Icon Toggle Icon


Core CPI +4.1% YoY (+0.3% MoM)
Food +3.7% YoY (+0.2% MoM)
Energy -0.5% YoY (+1.5% MoM)
Goods +0.0% YoY (-0.4% MoM)
Services 5.7% YoY YoY (+0.6% MoM)

The U.S. Consumer Price Index (CPI) for September held steady with a 0.4% month-over-month increase and a 3.7% year-over-year rise, meeting market expectations. Energy prices continued their upward trend, with gas and electricity prices rising 2.1% and 1.3% respectively, while natural gas prices fell. Food prices also saw a modest increase, particularly for dining out. Core inflation, which excludes food and energy, cooled slightly to 4.1% YoY, largely driven by the shelter index. Despite robust growth in various service sectors like car insurance and hospital services, goods prices, including used cars and apparel, continued their deflationary trend. Overall, the data suggests a mixed inflationary landscape, with energy and services pushing up costs, but core inflation showing signs of cooling.

From BLS

Inflation data continues to be a bit noisy with certain areas like energy and used car & vehicles driving the trends. That’s why the Fed is focused on the “super core” segment. The "super core" inflation, which excludes food, energy, shelter, and used cars, was up 0.2% MoM and 2.8% YoY in September, down from 3.2% YoY in August. The annualized rate of the last three monthly rates is just above 2.4%. The disinflationary trend is intact but hasn't really accelerated. This month's CPI data will likely leave Federal Open Market Committee (FOMC) members' opinions on the next policy step largely unchanged. The next FOMC meeting is at the end of the month, and there's still more data to come that will inform the decision... assuming the government stays open.