Consumer prices rose 0.4 per cent last month, slightly higher than August’s gain and pushing annual inflation back to the highest increase in 13 years.
The consumer price index rose 5.4% in September from a year ago, up slightly from August’s gain of 5.3% and matching the increases in June and July. Excluding the volatile food and energy categories, core inflation rose 0.2% in September and 4% compared with a year ago. Core prices hit a three-decade high of 4.5% in June.
The unexpected burst of inflation this year reflects sharply higher prices for food and energy, but also new and used cars, hotel rooms, airplane tickets and furniture, among other goods and services. Covid-19 has shut down factories in Asia and slowed US port operations, leaving container ships anchored at sea and consumers and businesses paying more for goods that don’t arrive for months.
Higher prices are also outstripping the pay gains many workers are able to obtain from businesses, who are having to pay more to attract employees. Average hourly wages rose 4.6% in September from a year earlier, a healthy increase, but not enough to keep up with inflation.