Americans paid more in October for gas, rent and used vehicles, triggering the biggest increase in consumer inflation in nine months.
The consumer price index climbed 0.3% in October to mark the biggest advance since January, the government said Wednesday. It also matched the forecast of economists polled by MarketWatch.
The increase in the cost of living over the past 12 months also rose - to 2.5% from 2.3%. The rate of inflation is still below a six-year high of 2.9% set three months ago, however.
Another measure that strips out food and energy edged up 0.2% last month.
Yet the yearly increase in the so-called core rate, a figure closely watched by economists, dipped to 2.1% from 2.2%. That’s the smallest increase since April.
Higher gas prices accounted for more than one-third of the increase in consumer prices last month.
The good news is, the falling price of oil is likely to result in lower prices and less pressure on inflation in the next few months.
Still, the cost of rent, used cars and trucks, medical care, home furnishings and car insurance also increased last month. These are major household expenses.
Prices for new vehicles and communications declined.
After adjusting for inflation, hourly wages slipped 0.1% in October. They are up 0.7% in the past year.
Inflation has forged higher this year largely owing to a strong economy that’s raised the cost of labor and many key materials. U.S. tariffs on billions of dollars of foreign goods have also contributed to higher prices.
Yet by and large inflation remains stable, and with a recent pullback in oil prices, consumer inflation could ease for a bit. That would allow the Federal Reserve to proceed with its strategy of gradually raising U.S. interest rates.
Some economists think inflation could consistently exceed the Fed’s 2% target by next year, however, potentially putting more pressure on the central bank to become more aggressive.