Inflation on Long Island ticks down slightly in September vs. 2024

WASHINGTON — U.S. inflation remained elevated last month as gas prices jumped while the cost of rents cooled, painting a mixed picture of the expenses consumers are facing in a murky economy where growth appears steady but hiring slow.

Consumer prices increased 3% in September from a year earlier, the Labor Department said Friday, the highest since January and up from 2.9% in August. Excluding the volatile food and energy categories, core prices also rose 3%, down from 3.1% in the previous month.

On a monthly basis, price increases slowed: They rose 0.3% in September, down from 0.4% the previous month. Core inflation also cooled to 0.2%, from 0.3% in August.

The figures show that inflation continues to rise more slowly than many economists expected when President Donald Trump imposed sweeping tariffs in April. Some of those duties were later reduced as part of trade deals, while many companies have only passed on part of the tariff cost to consumers out of concern that doing so would reduce sales. Businesses may shift more costs to consumers in the coming months if the duties appear permanent.

On Long Island and in the metropolitan area, consumer prices rose 3% in September compared with a year earlier. That was a slower rate of growth than August's 3.2% — and the slowest since February 2024.

The downward trend also was in contrast to the increases in the national consumer price index, according to data from the department's Bureau of Labor Statistics.

"The expected inflation bump from the tariffs hasn’t really kicked in, yet inflation remains above the Fed's target of 2% and will likely remain so," said John A. Rizzo, a Stony Brook University economist, adding the Federal Reserve is likely to cut interest rates two more times before Dec. 31.

"Although conditions look favorable at the moment, any meaningful spike in this [inflation] rate could change the economic outlook significantly," he told Newsday.

In September, in the metropolitan area, the biggest price increases were for household furnishings and energy, up 5.7% and 5.4%, respectively, year over year.

The pace of residential rent hikes slowed to 4.3% after hovering around 5% or more for months. The cost of gasoline continued to fall but at less than 1% after posting double-digit declines for most of the year.

Nationally, the smaller increase in the consumer price index will come as a bit of relief to Fed officials, who have signaled that they will cut their key interest rate at their meeting next week for the second time this year.

“Put simply, while inflation doesn’t appear to be accelerating, neither is it moving back toward [the Fed's] target,” said Eric Winograd, chief U.S. economist at asset manager at AllianceBernstein.

The price index was issued more than a week late because of the government shutdown, now in its fourth week. The Trump administration recalled some Labor Department employees to produce the figures because they are used to set the annual cost-of-living adjustment for roughly 70 million Social Security recipients. On Friday, that increase was set at 2.8% for 2026, equal to about $56 per month.

Newsday’s James T. Madore contributed to this story.