WASHINGTON (dpa-AFX) - Consumer prices in the U.S. increased by slightly more than expected in the month of September, according to a report released by the Labor Department on Thursday.
The Labor Department said its consumer price index rose by 0.2 percent in September, matching the increases seen in August and July. Economists had expected consumer prices to inch up by 0.1 percent.
Prices for shelter rose by 0.2 percent and prices for food climbed by 0.4 percent, contributing over 75 percent of the monthly increase by consumer prices.
A steep drop by energy prices helped limit the upside, with energy prices plunging by 1.9 percent amid a 4.1 percent nosedive by gasoline prices.
The report said core consumer prices, which exclude food and energy prices, climbed by 0.3 percent for the second consecutive month. Core prices were expected to rise by 0.2 percent.
The increase by core prices reflected the higher prices for shelter as well as higher prices for motor vehicle insurance, medical care, apparel, and airline fares. Prices for recreation and communication were among those that decreased.
Meanwhile, the Labor Department said the annual rate of consumer price growth slowed to 2.4 percent in September from 2.5 percent in August. Economists had expected the pace of price growth to slow to 2.3 percent.
The annual rate of core consumer price growth accelerated to 3.3 percent in September from 3.2 percent in August, while economists had expected the pace of growth to remain unchanged.
'Disinflation continues, but anyone who thought the Fed was going to lower rates by another .50 basis points in November is dead wrong,' said Jamie Cox, Managing Partner, Harris Financial Group.
'When interest rates aren't high enough to lower growth, they aren't high enough to stifle inflation completely either,' he added. 'The Fed will lower rates, but at a measured pace from here.'
On Friday, the Labor Department is scheduled to release a separate report on producer price inflation in the month of September.
Economists expect producer prices to rise by 0.2 percent in September, matching the increase in August, while the annual rate of producer price growth is expected to slow to 1.6 percent from 1.7 percent.
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