Inflation rose 3.7% while September hiring gained 29,000 jobs
The Conference Board said Tuesday that its consumer confidence index rose 7.5 points to 91.7 in October from 84.2 in September. September’s reading was the lowest in the board’s survey since April 2014 and below the lowest level reached during the pandemic. Both components improved in October: respondents’ views of their present situation rose 6.9 points to 72.6, while their short-term outlook increased 8.6 points to 120.4.
Fergus McCormick, a senior economist for The Conference Board, said, “The recovery was in line with retail gasoline prices easing from September to October.” He added, “Yet, despite the increase in October, consumer confidence remained on the long-term downward trend that’s persisted over the past few years.”
The Conference Board’s write-in responses, collected between October 1 and 21, remained broadly pessimistic. Respondents frequently referred to the high cost of energy, goods and services.
AAA said the average price for a gallon of regular gas in the U.S. was $4.27 Tuesday, down from $4.48 a month earlier. A gallon of regular averaged $3.05 at this time last year, leaving the price above its year-earlier level.
The Conference Board survey showed improved labor-market perceptions from September, but the government employment data for September showed slower hiring. The percentage of respondents who said jobs were “plentiful” rose from 24.3% in September to 26.7% in October, while the share saying jobs were “hard to get” remained at 21.4%.
U.S. employers added 29,000 jobs in September, while economists expected payrolls to increase by around 90,000. The unemployment rate rose to 4.2%. Hiring fell from a downwardly revised 133,000 in August, and Labor Department revisions also reduced combined July and August payrolls by 60,000. FRED’s UNRATE series carried the same 4.2% unemployment rate at an October 27, 2026 vintage date.
Earlier in the month, the Labor Department said the consumer price index rose 3.7% in the year through September, up from 3.4% in August, as goods and services became more expensive. From August to September, costs rose 0.6%, the largest monthly gain in five months.
AP reported that inflation had dominated conversations this year in business and households and that wage gains had made rising prices more painful for many. Average hourly wages rose 3% from a year earlier last month, the smallest year-over-year gain since May 2021, and were not keeping pace with inflation.
Six weeks ago, the Federal Reserve raised its benchmark interest rate by a quarter point to about 3.9%, the first increase since 2023, in an effort to reduce inflation. Over time, the increase could result in higher borrowing costs for mortgages, auto loans and credit cards. The Fed signaled another rate hike could occur later this year, though few expect one at this week’s Fed meeting.
The most recent measure of the Fed’s preferred inflation gauge, the personal consumption expenditures price index, rose 3.4% in August from a year earlier, AP reported. FRED’s PCEPI series put the year-over-year change at 3.419% at an October 27, 2026 vintage date. The 3.419% reading was below July’s 3.7% year-over-year increase but above 2.8% before the Iran war began on Feb. 28 and 2.5% when President Donald Trump was inaugurated in January 2025. The government is scheduled to issue September PCE data Thursday.
President Donald Trump has continued to blame high prices on his predecessor, Democrat Joe Biden, even as inflation has risen since Trump’s inauguration last year. AP said the September inflation report was evidence that rising prices remained an economic challenge just seven days before the midterm elections, with the campaigns focused heavily on affordability. AP also described Americans as remaining “flustered” by the economy after five years of elevated inflation and said that persistent frustration could pose a risk to President Donald Trump and Republicans in the midterm elections next Tuesday.