Tumbling energy costs kept US consumer inflation in check last month, blunting upward pressures in prices for housing and medical care, according to government data released Thursday.

As a result, the Consumer Price Index held steady in September, pausing following recent gains despite historically low unemployment and rising wages.

The latest figures were unlikely to shift views among Federal Reserve policymakers, many of whom fear the world's largest economy is increasingly vulnerable. The Fed later this month is expected to cut interest rates for the third time in 2019.

Compared to August, the CPI, which tracks costs for household goods and services, was flat as energy prices continued their recent decline, falling another 1.4 percent, including a 2.4 percent drop in gasoline.

Over the last 12 months, CPI rose 1.7 percent, the same as in August, as energy prices are down 4.5 percent.

US energy prices fell again in September and are down nearly 5% over the past year, holding down CPI
US energy prices fell again in September and are down nearly 5% over the past year, holding down CPI AFP / Frederic J. BROWN

Even when volatile food and fuel prices are stripped out, core CPI rose just 0.1 percent for the month, below economists' expectations.

Compared to September of last year, the core measure was up 2.4 percent, also the same as August -- which had been the biggest increase since July 2018 and a level not exceeded in a decade.

That measure was held down by a steep 1.6 percent drop in used car prices, but economist Ian Shepherdson of Pantheon Macroeconomics said they are expected to rebound, a repeat of what happened at this time last year.

"Overall, these data offer nothing to Fed hawks seeking to prevent another rate cut at the end of this month," he said in an analysis.

In addition to shelter and medical care, costs for auto insurance and household furnishings rose, along with education and air fares.

Inflation