With the September CPI report delayed, here’s what we know about inflation from other sources

It’s likely not news to you at this point, but the federal government shut down on October 1. When Congress fails to pass its annual funding measures, nonessential federal agencies close, furloughing staff and suspending operations. One of those agencies is the Bureau of Labor Statistics (BLS), which collects, processes and publishes national labor and price data.

The BLS already missed its scheduled release of the monthly jobs report on October 3, leaving investors without official government data on the state of the hiring market. The September Consumer Price Index (CPI) report was originally scheduled for release on October 15, and the shutdown made a delay all but inevitable. On October 10, the BLS announced it was bringing back critical staff to prepare and publish the CPI report. The expected release date of the September CPI report is now October 24.

To produce the CPI – one of the primary reports that policymakers, investors and business leaders follow to track inflation trends – the BLS collects price data from approximately 80,000 sources monthly, including 6,000 housing units and 23,000 retail establishments across 75 urban areas. During a government shutdown, this data collection apparatus stops. Field economists who typically visit stores to record prices are furloughed. The analysts who process and calculate the index can’t work, and the systems that publish the data go dark.

“The Consumer Price Index provides a national look at how prices across the economy changed over the preceding month and is an important input into the Federal Reserve’s decision making,” J.P. Morgan Wealth Management Global Investment Strategist Vinny Amaru said on why the CPI report is so closely watched. “For investors, changes in inflation can have an impact on all asset classes and portfolio allocation decisions.”

Even though certain BLS staffers will be able to return to work prior to the originally scheduled CPI release date of October 15, it usually takes several business days for agencies affected by a federal shutdown to get back up and running. In 2013, for example, the BLS didn’t release the CPI report for more than a week after the 17-day government shutdown ended. This time, essential employees will be working on a compressed timeline during the shutdown to get the report out.

What the most recent inflation data tells us

The August CPI pointed to a slight uptick in inflation, making the September report important for assessing whether this trend continues. Headline CPI rose 0.4% in August, up 2.9% year over year. When excluding more volatile food and energy prices, so-called core CPI rose 0.3%, up 3.1% year over year.

Shelter costs were the main driver of the increase, while gas prices rose 1.9% in August following several months of declines. Grocery and travel costs also saw moderate increases.

Despite inflation remaining above the Federal Reserve’s (Fed) 2% inflation target, policymakers found enough comfort in the lack of broad services inflation in the August CPI report to announce an interest rate cut in September to respond to a weakening labor market. September’s CPI will be an important data point for the Fed prior to their meeting in late October.

Alternative inflation data sources: Filling in the gaps without the CPI report

While it’s good to know the September CPI is coming, just on a postponed timeline, the report’s delay has required policymakers, investors and everyday consumers to turn to other sources of information in the interim. Nothing perfectly replaces the BLS, but together certain tools – including industry surveys – can augment the most recent official data to paint an approximate picture of what’s happening. Here’s what several inflation indicators reveal about trends in critical cost categories.

Housing: Costs edged slightly higher in August per CPI, and alternative sources point to flattening prices

According to the BLS, “the index for shelter rose 0.4 percent in August and was the largest factor in the all items monthly increase.” With the September numbers delayed, investors can monitor digital real estate platforms such as Zillow and Realtor.com, or even broader sources such as the S&P Cotality Case-Shiller Home Price Indices. Together, these show flattening national rent growth since the spring – and little growth in home prices over the past year.^{, ,}

Groceries: Prices continue to increase based on private data sources

While food costs are extremely variable – hence why they’re removed from core CPI, along with often-volatile energy prices – they’re a critical cost category for household budgets. The August CPI report made clear that families are continuing to spend more for food, both for pantry staples and restaurant meals.

Until September’s data is released, private sources can help consumers track what’s going on with grocery prices. The PriceStats Global Food Inflation Index, produced by State Street in partnership with the Massachusetts Institute for Technology, uses online prices to develop daily food inflation estimates for 25 countries. Datasembly’s Grocery Price Index measures weekly price changes using data from more than 150,000 stores (200-plus retailers) across 30,000 zip codes. Both indicate that grocery prices remained elevated in September.

Services and manufacturing: Starting to see the effects of tariffs

August CPI numbers were mixed in the main product categories that tend to be more exposed to tariffs, but data collected by the Institute for Supply Management (ISM), the world’s largest supply management association, points to strain in several industries.

Although ISM’s monthly Purchasing Managers’ Index (PMI) measures industry procurement, this data can nonetheless shed light on what’s happening on the consumer side. Based on a survey of business purchasing managers, the PMI shows whether company purchases in a specific sector (say, manufacturing) have gone up, gone down or stayed the same over the past month.

It’s important to note that the PMI is a weighted survey, and a reading above 50 within a “Prices” sub-index of the PMI indicates prices are rising month-over-month. The September PMI reports for manufacturing and services both signaled rising inflation. The ISM Prices Index for the services sector – which makes up most of the economy – registered 69.4, indicating rising prices. The Prices Index for the manufacturing sector registered 61.9 in September, also indicating rising prices.

Energy: Gas prices are down but remain volatile

Energy costs might be the most volatile component of inflation, but they’re also among the most visible. Gas prices posted at every corner station mean most Americans know when prices are rising or falling. With August’s CPI revealing that much of the relief attributed to July’s falling gas prices was all but wiped out – and with September’s CPI delayed – investors can track West Texas Intermediate or Brent crude oil benchmark prices.

According to the American Automobile Association’s (AAA) daily gas prices monitor, prices at the pump have come down about 3% overall across the past month, so September's report will show if this trend continues to hold.

Impact of the September CPI

The CPI is a crucial data source that influences not only how the Fed sets interest rates and manages economic policy but also how other federal agencies make program decisions.

CPI’s impact on the Federal Reserve

Without the CPI and the jobs report, central bank officials lose an input into assessing changes in prices, wage growth and hiring dynamics. While one month of disrupted data may not fundamentally shift the Fed’s trajectory, reliable, consistent measures are key to informed decision making.

The central bank cut rates by 25 basis points at its September meeting and signaled additional cuts ahead as hiring slows and unemployment creeps higher. Fortunately, the expected October 24 release of September’s CPI means the Fed will have updated numbers in time for its next meeting on October 28–29.

CPI’s impact on Social Security and other services

Social Security’s annual cost-of-living adjustment (COLA) announcement depends directly on the CPI. Pushing back the release of this figure impacts millions of retirees and those on fixed incomes because it delays news of benefit increases and creates uncertainty. It’s important to note that the Social Security Administration must meet a statutory deadline of November 1 for the Social Security COLA announcement. The Social Security Administration has stated they are on track for an October 24 COLA announcement, delayed from October 15.

Other agencies using inflation data for program budgets and payment adjustments could also see their policy calendars disrupted until reports resume.

CPI’s impact on investors

Investors don’t love uncertainty, and delayed official economic data opens the door to more volatility.

“Investors know that the Fed’s current priority is stabilizing the labor market, but the trajectory of inflation remains top-of-mind,” Amaru said. “The Fed has signaled a willingness to look through tariff-driven inflation. Investors will be watching September’s CPI report to determine whether tariff-driven inflation remained contained to goods prices, or if there’s been a pickup in services. Rising services inflation could make the Fed reassess the appropriate path of interest rate policy.”

The bottom line

The government shutdown has left investors and policymakers with less visibility into inflation and labor market trends, adding some uncertainty around the appropriate path forward for interest rates. While alternative data sources can partly fill the gap, they are not a replacement for government inflation data. Until October 24 – and even beyond that date – staying flexible and focusing on real-time, credible indicators can help investors make smart decisions.

View Disclosures