Inflation continued to ease in September, with the Consumer Price Index (CPI) increasing 0.2% on a month-over-month basis. The monthly increase matches figures from the previous two CPI reports, according to the U.S. Bureau of Labor Statistics (BLS). Over the last 12 months, the CPI increased 2.4%.
Shelter costs, which have been the main driver of inflation since early 2023, saw their annual growth rate fall below 5% for the first time since February 2022, according to the NAHB. The association suggests lower interest rates sparked by the Fed’s easing cycle could help ease some pressure on the housing market.
The index for shelter rose 0.2% on a month-over-month basis in September while the index for food increased 0.4%. Together, the food and shelter indexes contributed over 75% of the monthly increase in inflation.
Other top contributors to inflation that saw monthly increases include motor vehicle insurance (+1.2%), medical care (+0.4%), apparel (+1.1%), and airline fares (+3.2%).
The price index for a broad set of energy sources fell by 1.9% in September, with declines in gasoline (-4.1%) and fuel oil (-6.0%) offset by increases in electricity (+0.7%) and natural gas (+0.7%).
The indexes for owners’ equivalent rent and rent of primary residence increased by 0.3% in September. According to the NAHB, the gains to the two indexes have been the largest contributors to headline inflation in recent months. The NAHB’s “real” rent index—which indicates whether inflation in rents is faster or slower than overall inflation—remained unchanged after a 0.1% increase in August. Over the first nine months of 2024, the monthly growth rate in the “real” rent index averaged 0.1%, slower than the 0.2% average during the same period in 2023.
