Inflation rises to 3.7 percent in September as gasoline jumps, and Social Security sets a 3.6 percent raise for 2027

September inflation came in hotter than the forecast this site reported on Wednesday morning, and the same report set the size of next year's Social Security raise.

The Bureau of Labor Statistics said consumer prices rose 0.6 percent in September on a seasonally adjusted basis, after rising 0.4 percent in August, and were up 3.7 percent over the year, as of September. Economists polled before the release had expected 3.6 percent for the year. Gasoline was the largest single driver, up 9.1 percent in the month and accounting for more than half of the monthly increase, with energy prices up sharply over the year as the Hormuz shipping crisis and the war with Iran work through fuel markets. Food prices were unchanged in September after small rises in the two months before. Core inflation, leaving out food and energy, rose 0.3 percent in the month and 2.6 percent over the year, as of September.

Because federal law ties the Social Security cost of living adjustment to price data through September, the report completed the calculation. The Social Security Administration announced a 3.6 percent adjustment for 2027, up from 2.8 percent for 2026 and the largest since the 8.7 percent increase that took effect in 2023. It reaches about 76 million Americans counting Supplemental Security Income recipients. For the average retired worker it is worth roughly 75 dollars a month, taking the average benefit to about 2,170 dollars, as of October 15. Increased SSI payments begin December 31 because January 1 is a federal holiday, and individual notices arrive online from late November.

Politically, the report lands nineteen days before the November 3 midterms. Democrats in the House called the president a failure on costs, while a White House official told Fox News the administration is bringing inflation down from Biden era highs and pointed to stable food prices in the month. Markets, meanwhile, raised the odds they assign to a Federal Reserve rate hike at the October 27 and 28 meeting. This report describes published figures and what officials said. It is not financial advice. The picture is an illustration of shoppers at a checkout, not a photograph.