US inflation rose 3.7% in September — higher than economists predicted

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2 years ago

October 19, 2023

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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.

Environment

Rare earth stocks surge on U.S-China trade dispute over the critical minerals

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2 hours ago

October 13, 2025

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Rare earth stocks surge on U.S-China trade dispute over the critical minerals

A dump truck moves raw ore inside the pit at the Mountain Pass mine, operated by MP Materials, in Mountain Pass, California, U.S., on Friday, June 7, 2019.

Joe Buglewicz | Bloomberg | Getty Images

Shares of U.S. rare earth miners surged in early trading Monday, after President Donald Trump threatened China with retaliation over its strict export controls.

USA Rare Earth soared more than 18%, Critical Metals surged 18%, Energy Fuels jumped more than 11%, and MP Materials rallied about 8%.

Trump on Friday threatened China with a “massive” increase in tariffs in retaliation for Beijing imposing strict export controls on rare earth elements. The president then dialed down his rhetoric on Sunday, saying the situation with China will “be fine.”

The Defense Department, meanwhile, is accelerating its effort to stockpile $1 billion worth of critical minerals, according to The Financial Times.

And JPMorgan Chase said Monday it would invest up to $10 billion in companies that are crucial to U.S. national security.

“It has become painfully clear that the United States has allowed itself to become too reliant on unreliable sources of critical minerals, products and manufacturing — all of which are essential for our national security,” JPMorgan CEO Jamie Dimon said in press release.

Rare earths are a subset of critical minerals that are crucial inputs in U.S. weapons platforms, robotics, electric vehicles and other applications.

Environment

Bloom Energy shares soar more than 30% after striking deal with Brookfield to provide fuel cells to AI data centers

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2 hours ago

October 13, 2025

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Bloom Energy shares soar more than 30% after striking deal with Brookfield to provide fuel cells to AI data centers

Bloom Energy power storage equipment in San Ramon, California.

Smith Collection | Gado | Archive Photos | Getty Images

Shares of Bloom Energy surged Monday after striking a deal with Brookfield to deploy fuel cells for artificial intelligence data centers.

Brookfield will spend up to $5 billion to deploy Bloom Energy’s technology, the first investment in its strategy to support big AI data centers with power and computing infrastructure.

Shares of Bloom Energy were up more than 30% in early trading. Bloom’s fuel cells provide onsite power that can be deployed quickly because they do not rely on the electric grid.

Nvidia CEO Jensen Huang told CNBC last week that the AI industry will need to build power off the electric to meet demand quickly and protect consumers from rising electricity prices.

“Data center self-generated power could move a lot faster than putting it on the grid and we have to do that,” Huang told CNBC on Oct. 8.

This is breaking news. Please refresh for updates.

Environment

JPMorgan Chase says it will invest $10 billion into industries critical for national security

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3 hours ago

October 13, 2025

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JPMorgan Chase says it will invest billion into industries critical for national security

JPMorgan Chase says it will invest $10 billion into industries critical for national security

JPMorgan Chase on Monday said it is launching a decade-long plan to help finance and take direct stakes in companies it considers crucial to U.S. interests.

The bank said in a statement it would invest up to $10 billion into companies in four areas: defense and aerospace, “frontier” technologies including AI and quantum computing, energy technology including batteries, and supply chain and advanced manufacturing.

The money is part of a broader effort, dubbed the Security and Resiliency Initiative, in which JPMorgan said it will finance or facilitate $1.5 trillion in funding for companies it identifies as crucial. It said the total amount is 50% more than a previous plan.

As the biggest American bank by assets and a Wall Street juggernaut, JPMorgan was already raising funds and lending money to companies in those industries. But the move helps organize the company’s activities around national interests at a time of heightened tensions between the U.S. and China.

On Friday, markets tumbled as President Donald Trump announced new tariffs on Chinese imports after the major U.S. trading partner tightened export controls on rare earths.

In the release, Dimon said that the U.S. needs to “remove obstacles” including excessive regulations, “bureaucratic delay” and “partisan gridlock.”

JPMorgan said that within the four major areas, there were 27 specific industries it would look to support with advice, financing and investments. That includes areas as diverse as nanomaterials, autonomous robots, spacecraft and space launches, and nuclear and solar power.

“Our security is predicated on the strength and resiliency of America’s economy,” Dimon said. “This new initiative includes efforts like ensuring reliable access to life-saving medicines and critical minerals, defending our nation, building energy systems to meet AI-driven demand and advancing technologies like semiconductors and data centers.”

The bank said it would hire an unspecified numbers of bankers and create an external advisory council to support its initiative.

This story is developing. Please check back for updates.