Consumer spending stalled in September as inflation remained stubborn

In September, higher gas prices drove some inflation indexes higher. Grace Cary/Moment RF/Getty Images

Inflation ticked up to its highest annual rate since April 2024 and consumer spending cooled in September, according to a shutdown-delayed report released Friday by the Commerce Department.

The Personal Consumption Expenditures price index — the inflation gauge the Federal Reserve uses for its 2% target rate — rose 0.3% on a monthly basis, which lifted the annual rate to 2.8%, a rate last hit in April 2024.

Friday’s data came in largely as anticipated.

Economists were expecting inflation to rise 0.2% from August and tick higher to 2.8%, according to FactSet.

Americans also reined in their purchases some in September after an August splurge. Spending rose 0.3% from August and was fl