The Globe and Mail reports in its Saturday edition that the Federal Reserve's preferred measure of inflation changed little in September, likely easing the way to an interest-rate cut by the central bank next week.
Prices rose 0.3 per cent in September from August, the Commerce Department said Friday, in a report that was delayed five weeks by the government shutdown. An Associated Press dispatch to The Globe reports that it matched the increase recorded during the previous month. Excluding the volatile food and energy categories, core prices rose 0.2 per cent in September from August, the same as August, and a pace that if it continued for a year would bring inflation closer to the Fed s 2-per-cent target.
Compared with a year ago, overall prices rose 2.8 per cent, up slightly from 2.7 per cent in August. Core prices also rose 2.8 per cent from a year earlier, a small decline from the previous month s figure of 2.9 per cent. Core inflation was low in September, supporting the case for a Fed interest rate cut at the upcoming meeting. Although inflation exceeds the 2-per-cent target, many officials believe that weak hiring, modest growth and slowing wage gains will gradually reduce price increases in the months ahead.
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