By John Meyer, consultant in business and financial affairs – Eurasia Business News, October 24, 2025. Article no 1852
Times Square, Manhattan, New York City- Photo credit : Swann Collins
U.S. inflation edged up to an annual rate of 3% in September 2025, marking a modest increase from 2.9% in August and slightly below economists’ forecasts of 3.1%. This rise is the fastest since January, highlighting continued pressure on consumer prices amid ongoing trade tariffs and elevated energy costs.
The Consumer Price Index (CPI) grew 0.3% month-over-month, with energy costs serving as the largest contributor. Gasoline prices climbed by about 4%, while food price growth slowed compared to August. The CPI data, delayed due to a government shutdown, was released late by the Bureau of Labor Statistics.
Core Inflation and Economic Context
Core inflation, which excludes food and energy, also came in at 3%, down slightly from 3.1% in August — a sign that underlying price pressures may be easing. The Federal Reserve is widely expected to respond by cutting interest rates at its upcoming meeting, as the softer inflation data supports continued monetary easing to support slowing job growth.
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Key Contributing Factors
- Energy: +2.8% year-over-year, driven by fuel oil and gasoline.
- Housing (shelter): steady at +3.6% year-over-year.
- Vehicles: new cars up 0.8%; used cars down 5.1%.
- Food: inflation eased slightly to +3.1%.
In summary, inflation in the U.S. rose modestly to 3% in September 2025, maintaining upward price trends but offering reassurance to policymakers that inflationary pressures remain contained. The reading strengthens expectations for Federal Reserve rate cuts in the near term.
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