Inflation Jumps Higher In Final Report Before Midterm Elections

Inflation accelerated in September as surging gasoline prices drove consumer costs higher, delivering another blow to Republicans’ chances to retain both the House and Senate in November’s election.

The Consumer Price Index (CPI) rose 3.7% from a year earlier, up from 3.4% in August, according to data released Wednesday by the Bureau of Labor Statistics (BLS). The report landed less than three weeks before November’s midterm elections, as polling showed President Donald Trump and Republicans struggling with voters over inflation and the economy.

Gasoline prices jumped 9.1% in September, accounting for more than half of the monthly increase in consumer prices. Gas prices were 34.2% higher than a year earlier, while fuel oil prices surged 74.2% over the same period.

Consumer prices climbed 0.6% in September alone, exceeding economists’ expectations and raising the prospect of another Federal Reserve interest rate hike as Americans contended with mounting financial pressures.

The broader energy index climbed 5.2% during September and 20.4% over the past year, reflecting the continued fallout from disruptions to global energy supplies amid the conflict involving Iran.

An August Reuters/Ipsos poll found that 47% of registered voters considered the cost of living the single most important factor in deciding their congressional vote, while 71% of Americans disapproved of Trump’s handling of the issue.

A separate Gallup poll released Tuesday found that 51% of Americans trusted Democrats more to keep the country prosperous, compared with 37% who favored Republicans. The 14-point Democratic advantage was the party’s largest advantage since 2007.

Inflation also extended beyond the gas pump. The index excluding volatile food and energy prices, commonly known as core inflation, rose 0.3% in September and 2.6% over the previous 12 months, up from 2.4% in August. 

Housing costs continued climbing, with the shelter index rising 0.4% during September and 3.2% over the past year. Used cars and trucks increased 0.7% over the month, while airline fares climbed 1.2% and recreation costs rose 0.5%.