The Bureau of Labor Statistics is set to release the September inflation data on Friday morning, marking a crucial moment amid the ongoing government shutdown. This event will occur at exactly 8:30 a.m. ET and represents the first major economic report since the shutdown commenced on October 1.
Expectation of Inflation Increase
Economists from Dow Jones and Bloomberg predict that the annual inflation rate for September will rise to 3.1%, maintaining the persistent trend observed over the past two years. This rate is significantly above the Federal Reserve’s target of 2%.
Wages and Consumer Sentiment
Despite higher wages reaching a new post-pandemic high in the second quarter, consumers are still feeling the impact of rising prices. Surveys indicate that inflation and prices have overtaken tariffs as primary concerns for consumers, according to the Conference Board.
- The University of Michigan’s surveys show a 22% drop in consumer sentiment from the previous year.
- Economists from Bank of America predict tariffs will continue to drive inflation over the coming quarters.
Upcoming Economic Influences
Goldman Sachs analysts forecast an increase in headline inflation, primarily due to higher gasoline prices, while food inflation remains a significant concern. The forthcoming CPI data is expected to have a considerable effect on U.S. markets, especially given the government data blackout period.
This release occurs just before the Federal Reserve’s policy meeting scheduled for October 28-29, where discussions regarding potential interest rate cuts are anticipated. The CPI will play a crucial role in shaping the Fed’s evaluation of the economy.
Impact on Social Security COLA
The inflation figures from July, August, and September are critical for determining the Social Security Administration’s annual cost-of-living adjustment (COLA) for 2026. Originally slated for mid-October release, the COLA announcement has also been postponed due to the shutdown.
As economic uncertainties linger, the upcoming inflation report will provide essential insights into the trajectory of the U.S. economy and consumer welfare.
