CPI Inflation Data Hot

The CPI inflation rate continued to cool in September, but less than expected. Core consumer prices, which exclude food and energy, rose at the fastest annual rate since 1982. Stocks opened in a steep dive following the CPI inflation report, but the Dow Jones turned positive by late morning. Treasury yields jumped above 4% as the data reinforced Fed rate hike expectations, but then pared gains somewhat.

September's CPI inflation rate came in at 8.2%, down from August's 8.3% and June's 40-year high of 9.1%. The consumer price index rose 0.4% vs. August. Economists expected a 0.2% monthly gain with the headline inflation rate drifting down to 8.1%.
There's little evidence that underlying inflation pressures are coming down.

The core CPI inflation rate climbed 6.6%, picking up from August's 6.3%.  That exceeds March's 39-year peak of 6.5%. Core prices advanced 0.6% vs. August. Wall Street had forecast a 0.4% monthly rise and core inflation at 6.5%.