Here's the inflation breakdown for September 2026 — in one chart

Key points

• US consumer price inflation rose to 3.7% in September from 3.4% in August, driven by higher gasoline and energy prices amid the Iran war.
• Core CPI, excluding food and energy, increased to 2.6% from 2.4%, with economists saying the report shows inflation is uncomfortably strong.
• Gasoline prices jumped 9.1% in September and are up 34% over the year, while diesel prices rose about 68% since before the war.

The U.S. inflation rate increased in September as higher gasoline and energy prices tied to the Iran war squeezed household budgets and put pressure on the Federal Reserve to consider raising interest rates, economists said. The consumer price index rose 3.7% from a year earlier, up from 3.4% in August, the Bureau of Labor Statistics reported Wednesday.

Core CPI, which excludes volatile food and energy prices, rose to 2.6% from 2.4% in August. The reading comes less than a month before midterm elections, where affordability is a primary voter issue.

What economists said

Mark Zandi, chief economist at Moody's, said the overall report shows inflation is uncomfortably strong and that the war's fingerprints are all over it. He added that the CPI report gives more support to the argument that the Fed will continue raising rates.

Michael Reid, head of U.S. economics at Royal Bank of Canada, called inflation an oil story and said that will be the story for a few more months. A Wells Fargo Investment Institute analysis published Tuesday said inflation pressures will likely push the Fed to hike rates between now and spring 2027.

The overall report shows inflation is uncomfortably strong

— Mark Zandi, chief economist at Moody's

Energy and consumer impact

Gasoline prices rose 9.1% in September alone and accounted for more than half of the monthly CPI increase. The average nationwide price at the pump was $4.33 per gallon on Wednesday, up 45% from $2.98 on Feb. 27, before the Iran war began, according to AAA. Diesel prices averaged $6.30 per gallon, up about 68% from $3.76 before the war.

The University of Michigan's consumer sentiment index sank to its second-lowest reading on record in September. Joanne Hsu, director of the Surveys of Consumers, said frustration over cost-of-living continues to mount as consumers across the political spectrum believe the economy's trajectory has weakened since the start of the year. The Social Security Administration announced a 3.6% cost-of-living adjustment for 2027 benefits.