October Inflation Tops Forecasts as Grocery Prices Jump

Core inflation, which excludes food and energy, increased 0.3% for the month, compared with economists’ expectation of 0.2%. The Bureau of Labor Statistics did not provide annual price estimates because it collected no data last October during a government shutdown.

Heather Long, chief economist at Navy Federal Credit Union, said the figures implied inflation of about 4% over the past year. She also pointed to monthly increases in dining out, electricity, transportation—especially airfares—rent and medical services, particularly hospitals. Analysts have linked rising costs across the economy, including food prices, to higher fuel and fertilizer expenses associated with President Donald Trump’s war with Iran.

Economist Ben Zipperer of the Economic Policy Institute posted a chart showing real wage growth declining in the seven months since the war began in February. University of Michigan economist Justin Wolfers said real wage growth had been flat throughout Trump’s second term, with prices accelerating after the war began. “The average real wage—what your paycheck buys—is falling,” he wrote.

National Economic Council Director Kevin Hassett called the report “disappointing” in a Tuesday interview with Fox Business. He said CPI energy prices were up 20% year over year and gasoline prices 37%, adding that the effects of higher energy costs were “definitely very palpable in the data.” Sen. Chuck Schumer (D-NY) blamed Trump’s tariffs and war for worsening inflation, and said Democrats would work to reduce costs when they take control of the Senate majority next year.