Inflation Ticks Down, Jobless Claims Up

The consumer price index dropped to an annual inflation rate of 2.4% in September, the lowest annual level since February 2021. Separately, weekly jobless claims surged to 258,000 last week, the highest number in 14 months—possibly the consequence of a chain of hurricanes and recent labor strikes.

The consumer price index—a data tool dating to the 1910s—takes roughly 80,000 price measurements of more than 500 types of goods each month, with the percent change indicating overall price movements (how it works). The measure peaked at an annual rate of 9.1% in June 2022, but has steadily dropped to near the Federal Reserve’s target annual rate of 2%. 

The Federal Reserve last month made its first cut to the federal funds rate in four years, with more cuts expected. The inflation report is the last before the Nov. 5 presidential election, for which surveys suggest the economy is the most important issue.