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In a stunning come-from-behind win, inflation decided to slow down in September, reaching a low so fresh that it feels like a newborn baby still covered in goo. That’s right! Just when we thought inflation was more stubborn than a toddler refusing to eat broccoli, it decided to mimic the delightful pace of 2017 and 2018.
Cue the confetti: the Consumer Price Index (CPI) rose only 2.4% over the past year, which is technically better than your last relationship if you’re counting red flags. Economists had dared to dream of a 2.3% rise, but reality swept in with the grace of a drunken walrus.
But hold onto your pocketbooks, folks! While we bask in this minor victory, we’re reminded that some prices are as stubborn as a cat in a bathtub. Despite the slowdown, other factors such as weather disasters—because why not throw a hurricane into the mix?—could send your grocery bills shooting up faster than a kid on a sugar high.
“Honestly, inflation is just like a bad sequel—it’s dying, but it refuses to die,” said Olu Sonola, Fitch Ratings’ head of US economic research. Talk about a plot twist.
Month-over-month, prices nudged up by 0.2%, in sync with August’s numbers, which is like saying your diet is “on track” because you only gained a pound instead of two.
And just when you thought it was safe to pull into the grocery store, a bird flu decided to take flight, causing egg prices to soar like your hopes of finding a parking spot on a busy Saturday.
But when you strip away all that chaotic food and energy nonsense, the core CPI is up 0.3% in September, like your ex just pretending to be civil at a party. It’s barely manageable, right?
So here we are, teetering on the edge of a financial cliff as the Federal Reserve rubs its chin and ponders whether to lower interest rates, like trying to decide between a salad or a triple cheeseburger.
“Good news! Shelter costs slowed down,” says Eugenio Aleman, Raymond James’ chief economist, while secretly hoping everyone forgets about that ominous lurking inflation. So predictable, it might as well have a theme song.
Yet the housing crisis remains a brick wall, obstinate and annoying, just like that one roommate you never wanted in the first place.
And here comes the glimmer of hope: housing inflation finally decided to join the land of the living and is now at its lowest since February 2022. Pop open the non-alcoholic champagne!
Alas, while it’s a waiting game, inflation continues to elbow its way into our grocery bills, proving once again that it’s a guest who never leaves the party.
Our old friend egg prices are back, boasting an increase of 8.4% last month—a fabulous party trick brought to you by none other than the avian flu.
But fear not, even if our grocery bills are up more than a teenager’s self-esteem, overall grocery prices are still less chaotic than the inflation circus, with an increase of just 1.3% for the year ending in September.
Meanwhile, the inflation outlook looks brighter than a freshly polished trophy, thanks to the sudden halt of a massive dockworkers strike. We’re in the clear… for now!
But economists, in their infinite wisdom, caution that hurricanes, wars, and random US policy decisions could still throw a wrench into the inflationary gears, like a cat throwing up on your favorite rug.
Energy prices are set to be the drama queen of categories, with fluctuations likely to keep economists guessing more than ever. Fasten your seat belts; it’s going to be a bumpy ride!
And let’s not forget our good friend, Donald Trump—should he regain office, he could unleash a tariff storm so wild it might make inflation look like a mere tempest in a teapot.
But as it stands, the inflation forecasts shine brighter than a new penny. The storm seems to be passing, leaving us to cope with any lingering effects of chaotic price hikes.
“But don’t get too comfy,” says Allen, delivering the final punchline. Apparently, the price roller coaster can still surprise us, delivering the odd jolt here and there—just like your high school reunion.
Coming Up: More data. And an Election!
As we countdown to the Election Day bonanza, inflation officially took a backseat on the campaign trail—because nothing says “vote for me!” quite like a slow CPI report.
Interestingly enough, Mr. Trump has pivoted from a full-on inflation attack to minor carping. Just 10.5% of his ads currently mention inflation, down from a whopping 79% in September. Guess he finally found a new punchline!
Meanwhile, Vice President Kamala Harris, perhaps sensing that inflation might still be out there lurking like a bad Tinder date, has rolled out a new ad focusing on her inflation-fighting policies.
As for Thursday’s report, it has the honor of being the last CPI before both the grand presidential election and the Federal Reserve’s next meeting. Talk about a pressure cooker!
Hang tight because other key inflation data, like wholesale inflation, will drop like a hot mic just before the end of the month. And let’s not forget—October’s jobs report drops on November 1, serving as the cherry on top of this chaotic cake.
Who knows? The October jobs report may make things even noisier than a toddler’s birthday party: strikes, hurricanes, and all sorts of events loosening up the numbers.
On a separate note, the Labor Department reported a surprising spike in first-time unemployment claims, reflecting the chaos happening in our job market—thanks, kids, I mean hurricanes.
This story has been updated with additional context and developments, now including egg-citing price hikes!
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