US inflation up 3.7 pct in September

US consumer inflation surged 3.7% in September, exceeding expectations, according to government data released on Wednesday. The increase is attributed to rising energy costs resulting from the US's conflict with Iran, amplifying financial pressures on households as they approach the midterm elections. This significant rise, up from the 3.4% figure in August, surpasses economists' predictions of a 3.6% year-on-year rise, according to MarketWatch.

On a monthly basis, costs surged by 0.6%, the highest growth in five months, up from a 0.4% increase in the prior month.

The report underscores voter concerns over the high cost of living, occurring as President Donald Trump campaigns in various US states to bolster support for his Republican party seeking to retain control of Congress. The Consumer Price Index (CPI) showed a broader spread of price increases across the economy compared to recent months, with economists noting that consumer demand is holding up better than anticipated, despite the downbeat consumer surveys. "The report was worse than expected," remarked Bill Adams, chief US economist at Fifth Third Bank.

The inflation surge is likely to intensify pressure on the US Federal Reserve to raise its key interest rate at its upcoming meeting. Economists pointed out that the report revealed that price increases were more widespread across the economy than in recent months. "Price increases were widespread. ... Consumer demand seems to be holding up better than the downbeat consumer surveys would suggest, helping businesses maintain pricing power," stated Adams in a note to clients.

These figures come as the last major inflation data before the elections. Ongoing inflation has affected Trump's approval ratings among US voters. A poll by The Associated Press-NORC Center for Public Affairs Research found that only 17% of US adults approve of his handling of the cost of living issue, with only 26% approving of his overall economic management, a new low.

Rising prices are diminishing Americans' earnings, as the US Labor Department reported on Wednesday that average weekly paychecks, adjusted for inflation, declined for the first time since May compared to a year ago.