U.S. Inflation Rises 3% in September as Gas Prices Surge

U.S. inflation rose to 3.0% in September 2025, marking the highest annual increase since January, driven largely by a 4.1% surge in gasoline prices. While overall consumer prices increased 0.3% monthly, core inflation, which excludes volatile food and energy costs, cooled slightly to 0.2%, suggesting some easing in underlying price pressures. Despite this slight moderation, inflation remains above the Federal Reserve's 2% target, complicating the Fed's policy decisions amid signs of a cooling labor market. The delay in releasing the inflation report was due to a prolonged government shutdown, but the data was prioritized to adjust Social Security benefits for millions of Americans. The Trump administration's tariffs have contributed to inflationary pressures, and businesses may pass more costs to consumers if tariffs persist. Federal Reserve officials are expected to cut interest rates soon to support economic growth while carefully monitoring inflation risks.