Annual inflation climbed sharply in September, driven largely by fuel prices that stayed elevated during Trump’s war in Iran
Price increases came in above economists’ expectations and reached beyond energy into shelter, vehicles and clothing
Connecticut drivers are paying far more for gas and diesel than a year ago, and analysts expect the Federal Reserve to raise interest rates again
Inflation increased rapidly in September as fuel costs remained elevated due to Trump’s Iran war, climbing to 3.7% compared with September 2025.
The Bureau of Labor Statistics’ September report showed annual inflation hitting the 3.7 percent mark, up 0.6 percent from August, CNBC reported. Energy prices were the biggest driver, with the cost of gasoline jumping 9.1% over that period, but energy was not the only source of pressure on the marketplace.
Core inflation, which excludes more volatile food and energy prices, still climbed to 2.6% in September, up 0.3% from August. Prices for shelter, vehicles and apparel were notably higher during that period.
Economists expected increases in the month, but both general inflation and the CPI were above their estimates.
In the past year, gas prices grew 34.2 percent while fuel oil soared 74.2 percent. In Connecticut, according to AAA, gas prices for regular stood at $4.40 per gallon as of October 14, up from $3.08 a year ago, while diesel fuel stood at $6.45, just five cents below the all-time high of $6.49 reported on September 28 and almost three dollars higher than $3.76 in October 2025.
Shelter prices rose 0.4% in September, used vehicle prices rose 0.7% and apparel prices climbed 0.3%. The latter two categories are often affected by tariffs.
Inflation was trending close to the Federal Reserve’s general benchmark of 2 percent in early 2025, before Trump took office and imposed global tariffs, and fell back in early 2026 before surging due to the Iran War.
The results added to expectations that the Federal Reserve would raise interest rates again before the end of the year. Analysts put the odds of a rate increase in late October at more than 50% and the odds of an increase by year’s end at more than 90%, CNBC reported.
Heating costs grew significantly in September, while airfare is up 22.4 percent this year, the New York Times reported.
The Times also reported that the new data showed American wage growth since Trump took office in January 2025 had been about zero.
By Joe O’Leary
