Investing.com - Consumer price inflation (CPI) hit an almost 2-year high in September, though core inflation unexpectedly moved lower, easing pressure on the Federal Reserve (Fed) to tighten monetary policy, official data showed on Tuesday.
In a report, the U.S. Commerce Department said that consumer prices gained 0.3% in September from a month earlier, in line with expectations and compared to a 0.2% increase in the previous month.
Year-over-year, consumer prices increased 1.5% last month, also in line with forecasts and after having risen 1.1% in August. That was its highest reading since October 2014.
Consumer prices, excluding food and energy costs, increased by a seasonally adjusted 0.1% last month, below forecasts for a 0.2% rise and compared to the 0.3% advance seen in August.
Core CPI increased at annualized rate of 2.2% in September, below the prior month’s reading of 2.3%. Economists had forecast inflation to remain unchanged at 2.3%.
Core prices are viewed by the Federal Reserve as a better gauge of longer-term inflationary pressure because they exclude the volatile food and energy categories. The central bank usually tries to aim for 2% core inflation or less.
After the report, the dollar weakened. EUR/USD was trading at 1.1010 from around 1.0995 ahead of the release of the data, GBP/USD was at 1.2290 from 1.2274 earlier, while USD/JPY was at 103.84 from 104.00 earlier.
The US dollar index, which tracks the greenback against a basket of six major rivals, was at 97.64, compared to 97.78 ahead of the report.
Meanwhile, U.S. stock futures pointed to a higher open. The Dow futures gained 111 points, or 0.62%, the S&P 500 futures rose 16 points, or 0.74%, while the Nasdaq 100 futures traded up 41 points, or 0.86%.
Elsewhere, in the commodities market, gold futures traded at $1,263.70 a troy ounce, compared to $1,260.85 ahead of the data, while crude oil traded at $50.31 a barrel from $50.23 earlier.