(New York Times) — Inflation rose rapidly in September and a key measure accelerated to the fastest pace since 1982, underlining the relentlessness of price increases.

Fresh inflation data released Thursday showed that the consumer prices climbed far more quickly than expected and a key measure climbed to a fresh 40-year high, bad news for the Federal Reserve as it tries to bring the most rapid price increases in four decades back under control.

Overall inflation climbed 8.2 percent in the year through September, more than what economists recently surveyed by Bloomberg expected, though a slight moderation from the 8.3 percent increase in the year through August. The rate remains extremely high.

Prices increased 6.6 percent after stripping out fuel and food — which tend to be volatile and are often removed from inflation readings to allow for a better sense of underlying trends — a notable re-acceleration in the so-called core index. That was a fresh peak for the index this year, and was the fastest pace of annual increase since 1982.

Right now, Fed officials and Wall Street analysts more closely watch the monthly figures, including what happened between August and September. While the annual numbers reflect what has happened cumulatively over the past 12 months, the monthly data give a clearer snapshot of how prices are evolving in real time.

And those monthly numbers offered even more pronounced reasons to worry. Overall inflation climbed 0.4 percent in September, much more than last month’s 0.1 percent reading. The core index climbed 0.6 percent, matching a big gain in the prior month. That pace is far too fast for the Fed.

Because fast inflation has lingered for more than a year and half and has broadened to an array of goods and services — and because it is proving so relentlessly rapid — central bankers are likely to remain squarely focused on cooling off the economy and wrestling it lower. They have raised interest rates five times this year and have signaled that they expect to debate an increase of a half-point or three-quarters of a point at their upcoming meeting, but the new figures will bolster the case for the bigger increase.

While Fed policy takes time to be effective, inflation is picking up in demand-sensitive sectors that the central bank thinks it can affect, so the numbers are likely to signal to policymakers that they have more work to do in slowing down consumption and the labor market and wrestling inflationary forces under control.

“This is very troubling — the trend is very troubling,” said Blerina Uruci, a U.S. economist at T. Rowe Price, who explained that the hot inflation figure probably confirmed a three-quarter point move in November and may force the Fed to remain aggressive beyond that. “It is hard to see how they build the case to step down the pace in December.”

Many economists have been expecting inflation to moderate as supply chains heal, declines in used car prices make their way to buyers and consumer demand pulls back. But that process was always expected to be gradual, as rents continued to climb and other service costs increased.

Even the expected progress is failing to materialize, though. Underlying inflation — as measured by the core index — is re-accelerating after waning earlier in the summer. Especially worrying, service industries like pet care and dental care are posting big price increases, which could be a sign that tight labor markets are pushing up wages and feeding into higher prices.

“We are starting to see persistent inflation creeping into the economy,” said Steve Rick, chief economist at CUNA Mutual Group. “We are really concerned about this turning into a wage price spiral, with wages rising and making it hard to get inflation down anytime soon.”

The Fed aims for 2 percent annual inflation on average, though it defines that using a different inflation gauge: the Personal Consumption Expenditures measure, which will not be released until late October.

“It’s a pretty tough spot they’re in,” Ms. Uruci said.

— Joe Rennison contributed reporting.

Click Here to see the story as it appeared on the New York Times website.

Copyright 2022 The New York Times Company