The much-anticipated September inflation report released Thursday showed key regional differences in how much prices are rising.
The headline number for the consumer price index punched in at 3.7% nationwide, matching the level it was the month before. On a month-to-month basis, inflation rose 0.4%, slightly higher than projected. But some parts of the country are facing even worse inflation.
HIGHER SHELTER AND ENERGY PRICES PROPPED UP INFLATION AT 3.7% IN SEPTEMBER
New England is faring the best. Inflation is only running at 2.5% in Maine, New Hampshire, and Massachusetts. In Middle Atlantic states such as New Jersey and New York, inflation is clocking in at 3.2%.
The South is taking the worst beating from inflation. Overall, inflation is running at 4.2% in that region, but in Mississippi, Alabama, Tennessee, and Kentucky, it is even worse, coming in at a red-hot 4.6% annual pace.
The West Coast is also experiencing inflation that is higher than the national average, with California, Washington, and Oregon facing 4% inflation.
The Midwest is a mixed bag. Indiana, Illinois, and Ohio are seeing milder 2.9% inflation, while Missouri, Iowa, and the Dakotas are dealing with 3.7% inflation.
Cities across the country are also feeling pronounced differences in inflation. Minneapolis, Minnesota, and the urban parts of Hawaii have inflation coming in at just over 2%, while the Tampa, Florida, area is grappling with towering 6.7% inflation — nearly double the national average.
Denver, Colorado, is another area seeing higher inflationary pressure. Inflation there came in at 5.4% for the 12 months ending in September. Inflation was also nearly 5% in the San Bernardino area of California.
The higher inflation experienced in those parts of the country makes life less affordable for residents and means they get to bank less of their paycheck, as more of it is going toward spending on food, gasoline, and other necessities.
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The Fed has been raising interest rates for more than a year to drive down inflation, with the goal being to return the headline number to 2%. The central bank’s target rate is now 5.25% to 5.50%, with the most recent rate hike perhaps being the last of the Fed’s tightening cycle.
It will next meet at the end of the month. Investors now assign about a 93% chance that the central bank will hold rates steady once again, according to CME Group’s FedWatch tool, which calculates the probability using futures contract prices for rates in the short-term market targeted by the Fed.
