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.
The government has again delayed making a decision on whether the Chinese super embassy can go ahead.
New Housing Secretary Steve Reed, who took over from Angela Rayner, was due to approve or deny Beijing’s application for a 600,000 sq ft embassy near the Tower of London next Tuesday.
However, the decision has been delayed to 10 December, “given the detailed nature” of the planning application, and the need to give parties sufficient opportunity to respond”, the prime minister’s spokesman confirmed.
He added that the new deadline is “not legally binding”.
The spokesman denied the postponement was politically influenced and said it was “very much bound by the quasi-judicial” nature of planning law.
The delay comes the day after the government published witness statements it provided to prosecutors in the China spy trial that collapsed, prompting a blame game over whose fault it was that it dropped.
A decision had already been delayed from 9 September to 21 October after China submitted plans with large greyed-out sections, which said: “Redacted for security reasons.”
Image: The basements in most of the buildings have been greyed out ‘for security reasons’. Pic: David Chipperfield Architects
What are the concerns about the embassy?
It has become controversial due to concerns about it being turned into a Chinese spy hub for Europe and the fact highly sensitive financial cables run beneath it to the City of London and Canary Wharf.
The decision to delay again was made after the national security strategy committee wrote to Mr Reed on Monday saying that approving the embassy at its proposed site was “not in the UK’s long-term interest”.
Committee chairman Matt Western, a Labour MP, said in the letter the location presents “eavesdropping risks in peacetime and sabotage risks in a crisis”.
Tower Hamlets Council rejected China’s initial planning application in 2022 to turn Royal Mint Court, where British coins were minted until 1975, into the largest embassy in Europe over security concerns and opposition from residents.
Beijing did not appeal the decision after making it clear it wanted Conservative ministers to give assurances they would back a resubmitted application – but the then-Tory government refused.
Eleven days after Labour won the election last July, the application was resubmitted in nearly exactly the same form, and was soon “called in” by Ms Rayner for central government to decide.
Please use Chrome browser for a more accessible video player
10:12
Will China super embassy be built?
Conservative shadow housing secretary Sir James Cleverly accused the government of having “actively sought to silence the warnings” about the threats to national security from the embassy.
“It is essential the planning review has access to the full unredacted drawings for the Chinese embassy, and that the UK security agencies are able to submit evidence in private, using established processes,” he said.
“If Keir Starmer had any backbone, he would ensure his government threw out this sinister application – as Ireland and Australia did when faced with similar embassy development proposals from Russia.”
What has China said about the concerns?
In August, the Chinese embassy in the UK said the planning and design was “of high quality” and the application had “followed the customary diplomatic practices, as well as necessary protocol and procedures”.
Image: There have been multiple protests against the embassy’s development at the Royal Mint Court site. Pic: PA
The embassy added that it is “an international obligation of the host country to provide support and facilitation for the construction of diplomatic premises”.
And it reminded the UK that London wants to knock down and rebuild the British embassy in Beijing, which is in a very poor condition.
In September, a Chinese embassy spokesperson told Sky News that claims the new embassy poses a potential security risk to the UK are “completely groundless and malicious slander, and we firmly oppose it”.
They added: “Anti-China forces are using security risks as an excuse to interfere with the British government’s consideration over this planning application. This is a despicable move that is unpopular and will not succeed.”
One week into the ceasefire, a new kind of violence is plaguing the Gaza Strip.
Public executions, arson attacks and gun battles have raised the spectre of a slide into civil chaos as Hamas battles armed groups it accuses of collaborating with Israel.
Experts say Hamas is attempting to reassert its authority following Israel’s withdrawal from parts of the Gaza Strip.
But members of three anti-Hamas militias, operating from areas still controlled by Israel, have told Sky News they have no intention of laying down their arms and plan to fight Hamas to the end.
The fighting has drawn the ire of US President Donald Trump, who posted on his Truth Social platform on Thursday: “If Hamas continues to kill people in Gaza, which was not the deal, we will have no choice but to go in and kill them.”
Who are the Doghmosh clan?
On the night the ceasefire was agreed, Majed Doghmosh – not his real name – was sheltering in Gaza City’s abandoned Jordanian Hospital alongside his parents and six-year-old sister.
Like many residents of the surrounding Al Sabra neighbourhood, Majed belongs to the Doghmosh clan – an influential extended family which has long had a tense relationship with Hamas.
Many members of the clan had fled to the hospital two weeks earlier, after the Israeli forces entered Al Sabra.
Image: Israeli tanks visible outside the Jordanian Hospital (left) in Gaza City, 7 October 2025. Pic: Planet Labs PBC
When the ceasefire was announced, Majed says, “people began to rejoice that the war was over and life would return to normal.”
But as people were returning to their homes, a contingent from Gaza’s Hamas-led security forces arrived at the hospital. They said they were searching for collaborators.
‘They came with hundreds of people’
“We, as a family in general, have completely refused any cooperation with the occupation,” says Nizar Doghmosh, the family’s leader in Gaza.
“But the occupation managed to infiltrate one… weak, shallow-minded, foolish person.”
While in the Jordanian Hospital, Nizar says, this person recruited seven or eight others into an anti-Hamas militia.
Instead of handing themselves in, these men opened fire on the security forces, killing Mohammed Aqel – the son of senior Hamas commander Imad Aqel.
“Suddenly, we started hearing that Hamas wants to kill everyone who calls himself a Doghmosh,” Majed says.
“They came with hundreds of people, killing women, children and young people and burning down our homes.”
Majed fled, but left behind his parents and sister – who he says are still trapped and hiding in Al Sabra neighbourhood.
Palestinian journalist and social media influencer Saleh Al Ja’afari was killed on Sunday while reportedly covering the fighting in Al Sabra. It remains unclear who shot him.
Footage posted on Sunday shows a gun battle at a junction near the neighbourhood.
On Monday evening, footage emerged of a mass public execution at the same intersection.
“All they wanted were 6 or 7 people, and these people were killed,” says Basel Doghmosh – not his real name – who also managed to escape the fighting. “Now they are killing everyone.”
Speaking to Sky News in Gaza, Hamas spokesman Hazem Qassem described these incidents as “efforts to maintain order in Gaza, not acts of revenge”.
Image: Hamas spokesman Hazem Qassem told Sky News that Gaza’s government is attempting to maintain order.
“Hamas has not targeted any family,” he said.
“The occupation has formed armed militias loyal to it, and these militias are accused of high treason – the most severe charge in Palestinian revolutionary law.”
At least four anti-Hamas militias
Hamas has made a show of force in recent days, with its fighters appearing on street patrols and at hostage handover ceremonies across the Gaza Strip.
Datawrapper
This content is provided by Datawrapper, which may be using cookies and other technologies.
To show you this content, we need your permission to use cookies.
You can use the buttons below to amend your preferences to enable Datawrapper cookies or to allow those cookies just once.
You can change your settings at any time via the Privacy Options.
Unfortunately we have been unable to verify if you have consented to Datawrapper cookies.
To view this content you can use the button below to allow Datawrapper cookies for this session only.
Amjad Iraqi, a senior analyst at the International Crisis Group, says that Hamas’s “vicious” response to the Doghmosh clan is partly intended to deter other armed groups from challenging its authority.
Sky News has confirmed that at least four anti-Hamas militias are currently active within the Gaza Strip, all of them based in areas still under Israeli control – where Hamas is unable to operate freely.
Datawrapper
This content is provided by Datawrapper, which may be using cookies and other technologies.
To show you this content, we need your permission to use cookies.
You can use the buttons below to amend your preferences to enable Datawrapper cookies or to allow those cookies just once.
You can change your settings at any time via the Privacy Options.
Unfortunately we have been unable to verify if you have consented to Datawrapper cookies.
To view this content you can use the button below to allow Datawrapper cookies for this session only.
The most influential is a former looting gang led by Yasser Abu Shabab, which controls territory along Gaza’s main route for transporting aid. The group claims that 1,500 people are living in their territory, including 500-700 fighters.
Datawrapper
This content is provided by Datawrapper, which may be using cookies and other technologies.
To show you this content, we need your permission to use cookies.
You can use the buttons below to amend your preferences to enable Datawrapper cookies or to allow those cookies just once.
You can change your settings at any time via the Privacy Options.
Unfortunately we have been unable to verify if you have consented to Datawrapper cookies.
To view this content you can use the button below to allow Datawrapper cookies for this session only.
It is quite clear from the evidence Sky has gathered that Israel has pursued a policy of divide and rule in Gaza and is continuing to do so. It has armed and financed militia who are rivals to Hamas and is now allowing them to operate in areas under its control.
The security situation in Gaza would be bad enough without that kind of meddling. From the start of the ceasefire Hamas has clearly set out to reassert control as would be expected.
Its spokesman has told Sky News it is only reestablishing law and order and averting chaos. But it has never tolerated any groups threatening its grip on power in Gaza and is unlikely to start doing so now. From the video footage emerging from Gaza and eyewitnesses we have spoken to it is working hard on dominating the strip as it did before.
As the UN agency UNRWA told Sky, the last thing Gazans need right now is fighting between Palestinians. It threatens their lives and hampers the vital effort to get aid into Gaza.
Hamas is likely to prevail in a struggle with smaller more disparate groups. That will then raise questions for both Israel and the Trump peace plan.
The Netanyahu government promised Israelis total victory over Hamas. Hamas is far from dismantled even if it is unlikely to renew hostilities anytime soon.
Donald Trump has repeated his demand Hamas disarm. That will not happen, not least because it would leave them at the mercy of their enemies.
The best hope for the peace plan and for Gaza is the insertion of the multinational security force envisaged in the Trump plan. But that would appear to be months away and by then Hamas may be confident enough not to cooperate.
Members from three of the militias told Sky News they have no intention of laying down their arms, and intend to fight Hamas to the end.
Ashraf Al Mansi’s militia
The leader of the fourth group, Ashraf Al Mansi, posted a statement to social media on Tuesday warning Hamas against approaching areas under their control.
Al Mansi’s militia has established itself north of Gaza City.
Its headquarters are at an abandoned school more than 500 metres inside the Israeli zone of control.
Although the militia claims to control significant territory in northern Gaza, Sky News has not seen any evidence of their presence more than 200 metres from the school.
Where do the Halas militia operate?
Further south, to the east of Gaza City, gunfire could be heard on Tuesday as Hamas battled another militia, led by Rami Halas.
On Sunday, 12 October, Gaza’s Hamas-run interior ministry offered amnesty to any militia members not involved in killings, so long as they turned themselves in by 19 October. “Consider this a final warning,” the statement said.
Speaking to Sky News from his base in the Israeli-controlled zone, a member of the Halas militia says that his group has no plans to surrender.
“Hamas destroyed the Gaza Strip – it has become nothing but a pile of ashes and stones,” says Basel.
“We are not afraid of death as long as it is for the sake of liberating the Gaza Strip from their ignorance, backwardness, and destruction.”
Fighting could imperil planned aid surge
The growing violence comes as Palestinians continue to wait for a surge in aid promised under the ceasefire agreement.
Gaza City is currently experiencing famine, with the rest of the territory suffering from severe food shortages after months of Israeli restrictions on aid deliveries.
Sam Rose, Gaza director of the UN refugee agency UNRWA, says that mounting an effective aid operation will require Israel to allow aid in at scale and to give aid groups the freedom to move across the Gaza Strip.
“But we also need to know that our trucks and staff are not at risk from fighting or looting by armed elements,” he adds.
Among those leading the looting of aid trucks in the past was Yasser Abu Shabab, whose group has transformed itself into the most influential of the four anti-Hamas militias identified by Sky News.
Please use Chrome browser for a more accessible video player
5:01
A Sky News investigation has uncovered new details about Israel’s support for a Palestinian rebel group
We also found that Abu Shabab’s militia has been receiving food aid from the Gaza Humanitarian Foundation (GHF), a US- and Israeli-backed aid group.
Footage from the camp, verified by Sky News, shows large stocks of fresh produce.
In other videos, militia members can be seen showing off stacks of cash and smuggled valuables.
Israel accused of ‘divide and conquer’ strategy
The GHF told Sky News that “every Gazan deserves to be fed with dignity – including those in areas controlled by [Abu Shabab]”. The IDF declined to comment on Sky’s findings.
Crisis Group’s Amjad Iraqi says that, by supporting groups such as Abu Shabab’s, Israel has been engaging in a strategy of “divide and conquer”.
Image: Amjad Iraqi, a senior analyst at the International Crisis Group, says Israel is engaging in a strategy of “divide and conquer”.
“What’s happening right now is really a direct consequence of an Israeli policy throughout much of the war, but especially since it broke the ceasefire in March, to essentially render Gaza ungovernable.”
“A power vacuum… is to Israel’s advantage because it weakens Hamas and it weakens Gazan society writ large,” he says.
Additional reporting by Sophia Massam and Freya Gibson.
The Data and Forensics team is a multi-skilled unit dedicated to providing transparent journalism from Sky News. We gather, analyse and visualise data to tell data-driven stories. We combine traditional reporting skills with advanced analysis of satellite images, social media and other open source information. Through multimedia storytelling we aim to better explain the world while also showing how our journalism is done.
The Catholic Church has a “moral and spiritual obligation” to do more to help the victims of sexual abuse – and must take tougher action against their abusers, a Vatican report says.
The highly critical report from the Vatican’s child protection board faults Church leaders for not providing information to victims about the handling of their cases.
The report calls for the church to take tougher action on abusers, saying victims need reparations and tangible sanctions to heal.
“In many cases … victims/survivors report that the Church has responded with empty settlements, performative gestures, and a persistent refusal to engage with victims/survivors in good faith,” the report said.
Image: Pope Leo XIV, pictured attending a Global World Food Day ceremony in Rome on Thursday October 16, was elected in May. Pic: AP
The report also states that financial settlements should be paid to victims of abuse.
The new report is the second by the Pontifical Commission for the Protection of Minors, which was founded over a decade ago, with the first annual report only issued last year.
The commission states that monetary reparations are needed to help victims recover from the trauma of their abuse, along with “tangible and commensurate” sanctions for abusers and their enablers.
Compiled with input from dozens of survivors of abuse, the report, issued five months into the papacy of Pope Leo XIV, states that the Church must implement “concrete measures of reparation”.
Please use Chrome browser for a more accessible video player
4:24
Pope Leo holds inaugural mass
“The Church bears a moral and spiritual obligation to heal the deep wounds inflicted from sexual violence perpetrated, enabled, mishandled, or covered up by anyone holding a position of authority in the Church,” it states.
“The principles of justice and fraternal charity, to which every Christian is called, require not only an acknowledgement of responsibility, but also the implementation of concrete measures of reparation.”
Pope Leo has acknowledged that the abuse scandal remains a “crisis” for the Church – and that victims need more than just financial reparations to heal.
The commission was created by Pope Francis in 2014 to advise the church on best practices to prevent abuse.
However, it has encountered some resistance as it looks to confront the problem of abuse in the Church, and endorse victim-focused policies.
The 2024 report states that the Church’s way of handling abuse cases can itself be traumatising for victims.
“We must re-emphasise that the Church’s decades-long pattern of mishandling reports, including abandoning, ignoring, shaming, blaming, and stigmatising victims/survivors, perpetuates the trauma as an ongoing harm,” it states.
The commission is referencing the Church’s way of dealing with cases according to its in-house code, where the most severe punishment meted out to a serial abuser is dismissal.
Victims also have no rights to information about their case other than learning the outcome.
The report calls for sanctions that are “tangible and commensurate with the severity of the crime” – and also “clear” communication of the reasons for a resignation or removal of a priest.