U.S. producer prices were unchanged in September as a modest rise in the cost of services was offset by cheaper goods, pointing to a still-favorable inflation outlook and supporting views that the Federal Reserve would cut interest rates again next month.

US wholesale prices were unchanged in September, according to government data published Friday, as a small rise in the cost of services was offset by falling goods prices.

Consumer prices rose 3.7% in September compared to a year ago, holding steady from the previous month and running hotter than economists had expected. While inflation has fallen significantly from a peak of about 9% last summer,

U.S. producer prices were unchanged in September as a small rise in the cost of services was offset by cheaper goods, pointing to a still-favorable inflation outlook and supporting views that the Federal Reserve would cut interest rates again next month.

Inflation in September fell to an annual rate of 2.4%, its lowest point since early 2021, as gas and energy costs continued to ease.

Inflation came in hotter than expected in September. The consumer price index, a closely watched inflation measure, increased 2.4% from September 2023 to this past September. This index was expected to see a year-over-year increase of 2.

Key Takeaways Inflation decelerated in September, but not as much as forecasters had expected, thanks to an uptick in grocery prices.Core inflation rose on a year-over-year basis, dealing a setback to progress on the Federal Reserve's fight against inflation.

Consumer prices rose a little more than expected in September, but Wall Street's immediate consensus was that inflation didn't get hot enough to warrant another "jumbo" cut to the Federal Reserve's benchmark interest rate at the central bank's November meeting.