US inflation rises to 3% as rate cut looms
US consumer prices climbed 3 percent in September compared with a year earlier, the Labor Department reported on Friday, marking a slight acceleration from August but falling short of analyst predictions. Monthly inflation rose 0.3 percent, driven largely by gasoline costs that jumped 4.1 percent while food prices edged up just 0.2 percent.
The Federal Reserve appears set to cut interest rates by a quarter point next week, despite the uptick, with traders assigning a 97 percent probability to the move. Central bank officials remain focused on weak employment data, with August adding only 22,000 jobs, as they balance their congressional mandate to control both inflation and joblessness.
The report arrived nine days behind schedule because of the government shutdown, which has halted nearly all economic data releases for 24 days. Republicans and Democrats remain deadlocked over health insurance subsidies, leaving businesses and policymakers without critical October figures.
