War with Iran drives US inflation to 3.7% as gasoline surges 9.1%

Food prices were flat in September. Gasoline rose 9.1%, and accounted for more than half of the month’s overall increase in consumer prices.

The consumer price index rose 3.7% annually in September 2026, the Bureau of Labor Statistics reported on Wednesday. The index increased 0.6% during the month on a seasonally adjusted basis, its largest monthly rise in five months.

Energy was responsible for the bulk of the increase. Energy prices have climbed this year because of the war with Iran, placing the immediate strain on households through the cost of filling a car or heating a home.

Gasoline prices reached nearly $4.50 a gallon in late September and were up 34.2% over the past year. Fuel oil rose 15.3% in September and 74.2% on an annual basis.

The rise spread beyond the fuel market. Prices increased for shelter, vehicle costs and apparel, while higher fuel costs helped lift airfares by 1.2% in September and 22.4% over the year.

Some household goods also became more expensive. Toy prices rose 4.2% in September. Prices for computers and related equipment increased 9.7% over the past year, while software prices gained 28.4%.

Core CPI climbed 0.3% and posted an annual reading of 2.6%. The overall inflation rate remained well above the Federal Reserve’s goal in September.

The result is a squeeze that reaches from transport and home energy bills to a wider range of goods and services. The September figures show that the energy shock is feeding through household budgets even as food prices held steady for the month.