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US inflation rose 3.7% in September, more than economists expected and still well above the Federal Reserve’s 2% target, as the central bank weighs whether to hike interest rates again by year’s end.

The reading for the Consumer Price Index a closely watched measure of inflation that tracks changes in the costs of everyday goods and services matches the reading in August, and is slightly above the 3.6% advance that economists expected, according to data by the Bureau of Labor Statistics released Thursday.

On a monthly basis, inflation slowed to 0.4% from 0.6% in August, partly because of lower pressure from energy prices.

However, core CPI a number that excludes volatile food and energy prices and serves as a closely watched gauge among policymakers for long-term trends held steady at 0.3% month to month and rose 4.1% from a year ago, in line with expectations.

Though September’s CPI is also a cooldown from inflation’s 9.1% peak in June 2022, it still remains well above the Fed’s 2% goal. Stock futures dropped ahead of the market opening as traders increased their bets of another rate hike to around 50%, up from 30% earlier this week.

“The bigger picture is that the trend is still quite encouraging, but the fight continues,” said Olu Sonola, head of US regional economics at Fitch Ratings in New York. “They [Fed officials] may now want to extend the pause to December, given the recent increase in long-term rates.”

The gasoline index’s 2.1% advance was also a large contributor to the CPI, the data showed, though the federal agency said shelter’s 0.2% increase accounted for over half of the increase.

Gasoline experienced an eye-watering 10.6% increase last month, when AAA figures showed that the average price for a gallon of gas was $3.85.

As of Thursday, a gallon of gas in the US averages $3.65, according to AAA.

While many investors had been willing to look past the volatile energy numbers, a surprisingly resilient labor market has some worried that inflation could be more stubborn.

September’s employment report revealed that the US economy added a whopping 336,000 jobs last month — an unexpected surge that contradicts the notion the Fed may tamp down its aggressive tightening regime.

The blowout number was nearly double the 170,000 jobs economists had expected, and also sharply higher than an upwardly revised 227,000 jobs added in August, according to fresh data released by the Bureau of Labor Statistics last week.

The news sent yields on US Treasury bonds to their highest levels in 16 years and sent the Dow Jones Industrial Average into the red for 2023.

Since inflation hit a four-decade peak last summer, the central bank has worked to bring the stubborn figure down by hiking rates another 25 basis points to a 22-year high in August in hopes of an economic slowdown.

The benchmark federal funds rate currently sits between 5.25% and 5.5%. Last month, Fed officials unanimously decided to hold the record-high rate steady for the second time in six policy meetings so far this year.

But thanks to a strong labor market, the US economy has avoided a downturn, and even the Fed has said its no longer predicting the economy will slip into a recession by the end of the year.

“We must wait for more data to see if this is just a blip or if there is something more fundamental driving the increase such as higher rent increases in larger cities offsetting softer increases in smaller cities,” said US Bank of America Securities economist Stephen Juneau.

“When deciding whether to raise rates one last time this year, the FOMC will be asking whether inflation needs another nudge or if its getting to 2% on its own. Its increasingly looking like the latter,” NerdWallet data analyst Elizabeth Renter told The Post.

“The Fed, astheyreall too happy to remind us, is laser focused on getting inflation down to 2%.”

Fed Chair Jerome Powell has said central bankers will be taking a data-dependent approach moving forward, leaving more interest rate hikes before years end up in the air.

Markets were spooked ahead of the jobs report, falling more than 1% when the Labor Department released its Job Openings and Labor Turnover Summary, which showed job openings increased to 9.61 million in August up from 8.9 million in July.

With Post wires.

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Science

Point Nemo: The Remote Ocean Graveyard Where the ISS Will Make Its Final Descent in 2030

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NASA will retire the ISS in 2030, sending it to Point Nemo, a remote Pacific zone known as the spacecraft cemetery. Most of the station will burn up during reentry, with remaining debris falling harmlessly into the sea. The controlled descent aims to avoid past mishaps and reflects a new era of commercial space stations.

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Business

Chancellor Rachel Reeves blames other people’s mistakes for her predicament but she bears some responsibility

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Chancellor Rachel Reeves blames other people's mistakes for her predicament but she bears some responsibility

To say this wasn’t the plan is an understatement.

When Rachel Reeves said last year (and many times since) that she had no intention of coming back to the British people with yet more tax rises, she meant it.

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But now the question ahead of the budget later this month is not so much whether taxes will rise, but which taxes, and by how much? Indeed, there’s growing speculation that the chancellor will be forced to break her manifesto pledge not to raise the rates of income tax, national insurance or VAT.

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Chancellor questioned by Sky News

Her argument, made in her news conference on Tuesday morning, is that she is in this position in large part because of other people’s mistakes, primarily those of the Conservative Party.

But while it’s certainly true that a significant chunk of the likely downgrade to her fiscal position reflects the fact that the “trend growth rate” – the average speed of productivity growth – has dropped in recent years due to all sorts of issues, including Brexit, COVID-19 and the state of the labour market, she certainly bears some responsibility.

A problem that is some of her own making

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First off, she established the fiscal rules against which she is being marked by the Office for Budget Responsibility.

Second, she decided to leave herself only a wafer-thin margin against those rules.

Third, even if it weren’t for the OBR’s productivity downgrade, it’s quite likely the chancellor would have broken those fiscal rules, due to the various U-turns by the government on welfare reforms, winter fuel, and extra giveaways they haven’t yet provided the funding for, such as reversing the two-child benefit cap.

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Now, at this stage, no one, save for the Treasury and the Office for Budget Responsibility, really knows the scale of the task facing the chancellor. And in the coming weeks, those numbers could change significantly.

But it’s becoming increasingly clear, from the political signalling if nothing else, that the government is rolling the pitch for bad news later this month.

Indeed, for all that this government pledged to bring an end to austerity, a combination of higher taxes and lower spending will be highly unpopular, not to mention deeply controversial. And while the chancellor will seek to blame her predecessors, it remains to be seen whether the public will be entirely convinced.

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UK

Southport inquiry: Axel Rudakubana’s brother feared he would kill their father before attack

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Southport inquiry: Axel Rudakubana’s brother feared he would kill their father before attack

Axel Rudakubana’s brother feared he would kill a family member two years before the Southport attack, an inquiry has heard.

Dion Rudakubana, who is two years older than his brother, said Axel has a “short temper” and was prone to “violent outbursts”, hitting him regularly when they were children.

He said Axel’s behaviour escalated after he was expelled from the Range High School in Formby, Merseyside, in 2019 and their parents had “lost control”.

The public inquiry into the Southport attack heard by the time he left for university in 2022, Dion feared his brother would kill a family member.

In messages sent to a friend when he returned to the family home for Christmas, Dion said: “My brother doesn’t show mercy, my dad just has to try not to die… We hide knives to mitigate that factor.”

He told the inquiry there were times the police would be called out and recalled one incident when “my father was holding my brother off”.

“I remember being scared somebody was going to die… my dad,” he says.

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(Left to right) Bebe King, Elsie Dot Stancombe and Alice da Silva Aguiar. (Pic: Merseyside Police)
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(Left to right) Bebe King, Elsie Dot Stancombe and Alice da Silva Aguiar. (Pic: Merseyside Police)

Rudakubana was 17 when he murdered Elsie Dot Stancombe, seven, Bebe King, six, and Alice da Silva Aguiar, nine, in a knife attack on a Taylor Swift-themed dance class on July 29 last year.

Eight other children, who cannot be identified because of their age, were also injured, along with yoga instructor Leanne Lucas, who was leading the dance class, and businessman John Hayes, who was one of the first people on the scene and tackled the killer.

Giving evidence from a remote location by video-link, Dion’s voice could be heard but he could not be seen at Liverpool Town Hall.

After swearing on the Bible, he told how he and his brother grew up in Cardiff after their parents Laetitia Muzayire and Alphonse Rudakubana came to the UK from Rwanda and were granted asylum.

Flowers left at a memorial for the victims
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Flowers left at a memorial for the victims

Dion says the genocide had a “very heavy influence on them” but he doesn’t feel he was “traumatised” by his parents’ experiences.

His mother and father studied for degrees and moved to Southport in 2013 because his mother got a job, while his father started working as taxi driver because “he was not finding work in the area he studied in”, Dion said.

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He told how Axel was resentful of him after they had to move schools because of his health issues.

Dion said Axel was physically bigger, and he felt “increasingly wary” of his younger brother who would regularly hit him and smash plates and glasses in their home.

Dion said the last interaction he had with his brother was in the summer of 2023, when Axel threw a metal bottle at him, but luckily he had already closed the door.

In his witness statement, Dion compared his brother with the “sociopath” played by Javier Bardem in No Country For Old Men, who kills ten people over the course of the film.

“I watched it recently and it concerned me,” he told the inquiry, which continues on Wednesday.

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