Ongoing Slump in Consumer Prices: Inflation Stops at 3.7% in September

The latest consumer-price index published today by the Bureau of Labor Statistics is an indicator that inflation is slowly reaching a regular pattern. The index, which measures the average prices of consumer goods and services, indicated a 3.7 percent inflation rate in September, a 0.2 percent decrease from August’s 3.9 percent. This moderate change continues a gradual decrease in inflation, showing a 1.3 percent decrease from its peak in May. The slowdown in inflation could be a result of the decrease in energy prices in September. According EIA(Energy Information Administration) statistics, the US average diesel price fell from 3.343 USD per gallon in August to 3.191 USD in September, which could indicate a decrease in overall transportation costs. The September inflation rate was above the Federal Reserve’s target of 2 percent. The Fed’s inflation target is important because it shows the economic climate and helps to ensure that the United States continues to remain resilient to future economic shocks. The Federal Reserve’s current low-interest rate policy seems to have taken effect. Prices of goods and services have generally been stable, indicating that the economy is slowly recovering from its slump in March. It is clear that there is still room to grow, and the Federal Reserve will need to continue to monitor economic developments closely. But the fact that inflation has leveled off at 3.7 percent in September is an indication of a stable economic environment, even if prices remain higher than average.