By — Christopher Rugaber, Associated Press Christopher Rugaber, Associated Press Leave your feedback Share Copy URL https://www.pbs.org/newshour/economy/inflation-heats-up-again-days-before-midterm-elections Email Facebook Twitter LinkedIn Pinterest Tumblr Share on Facebook Share on Twitter Inflation heats up again, days before midterm elections Economy Oct 29, 2026 12:24 PM EDT WASHINGTON (AP) — An inflation gauge closely monitored by the Federal Reserve accelerated last month, showing that prices remain elevated less than a week before midterm elections in which the uncomfortably high cost of living for millions of Americans has become a central issue. Consumer prices rose 3.6% in September from a year earlier, the Commerce Department said Thursday, up from 3.4% in August. On a monthly basis, prices climbed 0.5%, up from 0.3% in August and the highest figure since May. READ MORE: U.S. economy grows at brisk 3.4% pace in third quarter on strong consumer spending and AI investment Rising gas prices drove much of the inflation increase as renewed violence in the Middle East has kept oil prices above $100 a barrel, up from below $70 before the Iran war. But prices also…
Inflation heats up again, days before midterm elections
In short
The Commerce Department reported that annual price growth reached 3.6% in September, with monthly costs jumping at their steepest rate since May. While high fuel costs played a major role, core inflation excluding volatile sectors also ticked up to 3.1% year-over-year. Although the economy expanded at a robust 3.4% annual rate, inflation-adjusted after-tax incomes fell 0.3%, indicating consumers are leaning on savings to absorb price hikes. This persistent price pressure raises the likelihood of a December rate hike by the Federal Reserve.
Key points
- Expanding price pressures across services suggest underlying inflation is becoming more e…: Expanding price pressures across services suggest underlying inflation is becoming more entrenched in the broader economy.
- Robust economic expansion coupled with rising prices increases the likelihood of a Federa…: Robust economic expansion coupled with rising prices increases the likelihood of a Federal Reserve rate hike in December.
- Falling real incomes suggest that consumer spending resilience is increasingly reliant on…: Falling real incomes suggest that consumer spending resilience is increasingly reliant on accumulated savings and credit lines.