US inflation fell to 2.4% in September

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US inflation fell to 2.4 per cent in September, as the Federal Reserve considers cutting interest rates again at its next meeting in November.

The figure was below August’s 2.5 per cent annual increase but above economists’ expectations of 2.3 per cent.

The latest consumer price index report marked the sixth consecutive month the annual headline rate has fallen.

Core inflation, which strips out volatile food and energy prices, rose to 3.3 per cent in the year to September, compared with the 3.2 per cent increase registered in August.

The latest figure comes as Democratic vice-president Kamala Harris seeks to contend with voters’ discontent about rising costs in her bid for the White House.

Thursday’s data is the last set of CPI figures before the November 5 election.

US central bankers will scrutinise the Bureau of Labor Statistics data as they wrestle with how quickly to cut rates to a “neutral” level that no longer inhibits economic growth.

The Fed cut rates by a larger-than-usual half-point last month.

The decline in inflation from its 2022 peak of 9.1 per cent has so far not triggered a significant weakening of the labour market, surprising many economists.

Last week’s US jobs report showed that businesses added 254,000 positions in September, far outstripping expectations. The unemployment rate fell to 4.1 per cent after several months of increases.

This week, New York Fed president John Williams told the Financial Times that monetary policy was “well positioned” to pull off a so-called soft landing following the half-point cut, as inflation eases and the economy keeps growing.

Williams said Fed officials’ projections released last month, which indicated a half-point worth of cuts to come over the two remaining meetings this year, were a “very good base case”.

Chair Jay Powell recently suggested such a reduction would be delivered through two quarter-point cuts rather than another half-point move.