Data expected this week will reveal that overall inflation in the United States accelerated in September due to higher gasoline prices, while underlying price pressures moderated, supporting the belief that the Federal Reserve will refrain from raising interest rates this month.

The closely watched consumer price index is likely to accelerate to 0.6% after a 0.4% increase in the previous month, based on the median forecast in a Bloomberg survey of economists ahead of Wednesday's Bureau of Labor Statistics data. That would represent the largest increase in five months.

Excluding fuel and food, the core index is expected to rise by 0.2%, a slowdown from August. Year-on-year, the core consumer price index is projected to climb 2.5%, a slight increase from the previous month, when it recorded its lowest annual rise since 2021.

Following a slowdown in job growth in September, the subdued core inflation reduces the need for the Federal Reserve to raise interest rates on October 28, after having raised them in September for the first time in three years. The Consumer Price Index data may also indicate that rising energy costs have not yet been passed on to most other consumer goods and services.

Bloomberg Economics experts' opinion:

Anna Wong, Eliza Winger, and Andrew Sacher write: Gasoline prices at the pump approached $4.50 a gallon in late September, the highest level in four months. With jet fuel costs also rising due to the conflict in the Middle East, the report may also show an acceleration in airfare prices. President Donald Trump announced on Friday an agreement to import Russian diesel in an effort to curb the sharp rise in fuel prices.

Concerns about affordability and rising prices have negatively impacted consumer confidence. While households have continued to spend, a key driver of the economy over the past six months, pessimism is growing.

Government data due on Thursday is expected to show a slowdown in retail sales growth in September. Retail sales are likely to have risen at a modest pace, after posting their biggest increase in nearly two years in August.

The busy week of US economic data will also include the release of the Producer Price Index for September and the Federal Reserve's report on industrial production. Data due Tuesday from the National Association of Realtors is likely to show weak existing home sales last month.

The Federal Reserve will release its Beige Book report on regional economic conditions across the United States on Wednesday.