US PCE index rose 3.6% in September — The Hill

In the United States, the personal consumption expenditures (PCE) price index, which is the Federal Reserve's preferred inflation measure, rose by 0.5% in September compared with August and by 3.6% year on year. In August, annual inflation under the PCE index fell to 3.4% after 3.7% in July, The Hill reports, citing data from the US Bureau of Economic Analysis.

The Federal Reserve Bank of Cleveland had forecast that the index would rise by 0.5% month on month and 3.6% year on year in September.

Rising energy prices

Prices for gasoline and other energy goods rose by 9.2% in September compared with August. A month earlier, their increase stood at 4.4%.

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According to the publication, spending on gasoline and energy increased in six of the year's nine months. The Hill links price shocks in the oil market to the war with Iran and shipping restrictions through the Strait of Hormuz imposed by the Islamic Republic of Iran.

The Fed kept rates unchanged

Persistent inflation, which, according to The Hill, has exceeded the Fed's 2% target for five and a half years, prompted the central bank to raise interest rates by 0.25 percentage points in mid-September.

However, the Federal Open Market Committee voted 10 to two on Wednesday to keep rates in the 3.75–4% range. Fed Chair Kevin Warsh said that the weeks leading up to the committee's next meeting in early December should provide more clarity on further monetary policy decisions.