Consider This from NPR - Inflation is ticking up. What does it mean for the economy?

Episode Date: October 14, 2026

A report from the Labor Department on Wednesday showed consumer prices in September were up 3.7% from a year ago. What does the data tell us about the state of the economy?NPR’s Scott Horsley contributed reporting to this episode.It was produced by Jeffrey Pierre, with audio engineering by Tiffany Vera Castro. Our director is Kai McNamee.It was edited by Tinbete Ermyas.Our interim executive producer is Courtney Dorning.Support public media with NPR+ and enjoy perks for over 25 podcasts like this one. This show’s perks include bonus episodes and sponsor-free listening. Learn more at plus.npr.org.See pcm.adswizz.com for information about our collection and use of personal data for sponsorship and to manage your podcast sponsorship preferences.NPR Privacy Policy

It's considered this where every day we go deep on one big news story. Today, inflation is heating up. It rose by 3.7% since last September. That's according to data released by the Bureau of Labor Statistics on Wednesday. Gasoline, smartphones, and rent, they all got more expensive last month, and people are feeling it. Right now, we're living in a RV motorhome. We do that for about five months and 20-some days a year. and the diesel is one place where we've gotten a gut punch.

Anita Barrett lives in Florida with her husband. We're getting by, but we don't have expensive taste. Consider this. Inflation is ticking up and some Americans are feeling squeezed. After the break, the head of Chicago's Federal Reserve Bank shares his thoughts on what he is seeing and where the economy may be headed. From NPR, I'm Scott Detrow. It's Consider This from NPR, a report from the World.

The Labor Department on Wednesday showed consumer prices in September were up 3.7% from a year ago, and that is a larger annual increase than the previous month. To better understand these numbers, we called Austin Goolsby. He is the president of the Federal Reserve Bank of Chicago and the former chairman of the Council of Economic Advisors under President Obama. Welcome. Thank you for having me. We know inflation is ticking up. One of the biggest stories of the year, consumer prices up 3.7% from last September. what is your initial thought when you heard that number?

Yeah, this report was a little disheartening. I wasn't surprised to hear it because as I've been going around the Chicago Fed District in the Midwest, what everybody's talking about businesses, individuals, nonprofits are about costs, about prices, about affordability. The thing that was unfortunate in this report, and you know, You never want to make too much out of any one month's inflation report because there's a lot of variability. But this is now a couple of months in a row where it's not just that the overall inflation was higher than expected and well higher than the Fed's 2% inflation target. As you started breaking out the components, the inflation of the subparts, they didn't look that great either.

some things can lead to inflation that is inherently temporary. And those would be things supposed to be like tariffs or oil shocks. Yeah. The services inflation in this report was a little distressingly high. Tell me more about that. Tell me more about that. Tell me what it is and tell me why you think it's happening. If it's not related to those big factors, we've spent so much time focused on this year.

We don't honor, we're still trying to, everybody's trying to get the what is the through line. And we were hoping that we had a couple of months of encouraging inflation readings. And we were hoping that the recent uptick might prove to be a blip. And so far it's not. The danger is that the inflation is less coming from things that, might naturally go away, like tariff impacts on prices, and is shifting more to just old-fashioned overheating of demand. And if it were, everybody's pointing the finger at the AI buildout.

The high investment, you hear a lot out on the trail, you hear a lot of comments that construction costs are rising radically. Electronic components, electricians, even land, that anything that data centers and their booming investment are involved in the software and others, you're seeing prices rising pretty rapidly. You're an economist. You know politics, too. You are well aware how much President Trump is pressuring the Fed right now politically on social media, legal challenges that have been, you know, pushed back on by the Supreme Court. Do you think his various pressure campaigns will have any effect on what the Fed does next in terms of interest rates, given how clear he is that he doesn't want to see them go up?

Well, you know the rules. Any member of the FOMC is only allowed to speak for themselves. They can't speak for the Fed or what. what the Fed thinks. There's a reason why economists, before I got to the Fed a little less than four years ago, I was a research economist, and economists are close to unanimous that central bank independence from political interference

in setting the interest rate is extremely important because anywhere that they give up that independence from political interference, that's a recipe for seeing inflation come roaring back. So if people do not want inflation to come back or want inflation to go down, we must separate these outside voices from what the decision is. I want to last question challenge you. This might be tough for a renowned economist like yourself.

But if you could tell the story, if you could tell the story, if you could tell the story, of this economy, as you understand it right now, in 30 seconds or less, what would it be? I actually think on the real side, as economists call it, which is GDP growth, consumer spending, the job market. Those have been remarkably stable. The job market has been stable without being good in that the hiring rate is low, but the layoff rate is also low. and the biggest problem facing the economy is no secret to any of you ask anybody it's about prices affordability and inflation and now we're grappling with this concept with this idea is this inflation going to go away on its own because the tariff shocks the oil shocks those kind of things are going to fade out or are we re-entering

a very persistent inflation environment, which is going to require more aggressive action to get us back to where we need to be. That's Austin Goolsby, President of the Federal Bank of Chicago. I've got to say, it was a minute and one second, but still a good answer. Thank you so much. Nice talking to you. And Pierre Scott Horsley contributed to this episode. It was produced by Jeffrey Pierre with audio engineering by Tiffany Bira Castro.

Our director is Kai McNamee. It was edited by Tin Beat Armius. Our interim executive producer is Courtney Dorney. It's Consider This from NPR. I'm Scott Detrow.