U.S. consumer prices pick up growth pace in September

U.S. consumer prices picked up growth pace in September, indicating that inflation pressure starts to firm.

Consumer Price Index (CPI), a main gauge of inflation, increased at a five-month high pace of 0.3 percent in September on a seasonally adjusted basis, compared to 0.2 percent growth in August, said the Labor Department on Tuesday. On a year-on-year basis, the index increased 1.5 percent, up from August's growth of 1.1 percent.

Food index was unchanged in September, while the energy index grew 2.9 percent in the month. Excluding the volatile food and energy categories, the so-called core CPI went up 0.1 percent in September on a seasonally adjusted basis, and was up 2.2 percent from a year earlier, slightly lower than August' s 2.3 percent increase.

However, the core personal consumption expenditure price index, the Federal Reserve's favored inflation gauge, increased 1.7 percent year on year in August, below the central bank's 2 percent inflation target.

The Fed kept its federal funds rate unchanged in its September meeting amid recent weak economic data and tepid inflation, but strongly signaled that the central bank could have one rate hike by the end of this year. Analysts widely hold that the Fed would keep interest rate unchanged in its November meeting, while possibly hike the rate in December. Enditem