The Briefing
Written October 1, before the latest jobs report and CPI inflation. The numbers and charts on this page are current; figures in the text may not be.
The Fed lifted its policy rate to 4% in September from 3.75%, with CPI inflation at 3.35% in August. Unemployment is 4.1%, and growth slowed to 2.2% in the second quarter.
The Briefing · Written October 1, 2026 · Numbers and charts update with each release
The Fed has moved rates up while inflation sits well above where it began the period
Fed funds target rate and CPI inflation, annual % change
Sources: Federal Reserve (DFEDTARU), BLS (CPIAUCSL). CPI for October 2025 was not published.
The rate rise is the first move in the last 24 months to go upward on the chart. The rate sat at 3.75% from December 2025 through August. Inflation was 3.35% in August, against 4.17% in May and 2.39% in January. Core PCE inflation, which strips out food and energy, is 3.01%, below its May high of 3.16%.
Households are squeezed. Average hourly earnings grew 3.09% in August, 0.27 percentage points below inflation after inflation is counted. The savings rate fell to 4.1%, its lowest in the last 24 months, from 4.6% in July. Retail sales are still up 5.36% on a year earlier. The read changes if the CPI report on October 14 shows inflation moving back toward 3%, or if the October 2 payrolls report departs sharply from August's 162,000.
Housing
Source: Freddie Mac (MORTGAGE30US)
The 30-year mortgage rate was 7.03% in the week of September 24, up from 6.67% on August 13. It is within a hundredth of a percentage point of the January 2025 high of 7.04%, and well above February's low of 5.98%.
Read the story →Households
Sources: BLS
Hourly earnings rose 3.09% in the year to August, the slowest in the last 24 months, while CPI inflation was 3.35%. That leaves pay 0.27 percentage points below inflation.
Read the story →Labor
Source: BLS (PAYEMS)
Employers added 162,000 jobs in August, up from 21,000 in July. The three-month average is 71,000, below the 142,000 average of the three months before it.
Read the story →Mixed. GDP grew 2.2% in the second quarter, down from 2.5% in the first, and unemployment is 4.1%. Inflation is 3.35% and the Fed raised its rate to 4% in September.
The unemployment rate was 4.1% in August, unchanged from July. It was 4.3% a year earlier and peaked at 4.5% in November 2025.
CPI inflation was 3.35% in August, up from 3.3% in July but well below the 4.17% peak in May. It has been above 3% for six months, and the three-month average is 3.37%.
No. Average hourly earnings grew 3.09% in the year to August, 0.27 percentage points below CPI inflation of 3.35%. Wage growth was 3.98% a year earlier.