With inflation continuing to rise this October, consumers will have to deal with elevated prices as they prepare for the holiday season. Though increases are smaller than in previous months, they are still creating affordability challenges for American households. 

In October, the Consumer Price Index for all items rose 0.4%, moderating slightly from September’s 0.6% rise, but still higher than predicted by economists. Due to last year’s government shutdown, inflation data for October 2025 was not compiled, so figures dealing with twelve-month changes are not available.

In positive news, certain goods experienced decreases last month: 

  • Used cars and trucks fell 1.2% in price
  • Some grocery prices including milk, bread, canned fruits and vegetables, and nonalcoholic drinks. 
  • The communication index dropped 0.1% over the month. 

Core inflation, which excludes volatile food and energy prices, provides a better snapshot of all prices and rose 0.3% last month, the same rate as in September. Shelter increased at the same rate, 0.3% in October. This is down slightly from September, when shelter prices rose 0.4%.

Paychecks are breaking even. Real average hourly earnings this past month stayed flat, with a 0.4% increase in average hourly earnings remaining level with the all-items increase of 0.4%.

Energy trends down

One positive sign in October was moderating energy inflation from the huge spikes of September. In September, the energy index rose 5.2%. In October, the same index increased 0.7%. While still higher than overall inflation, energy prices last month stopped skyrocketing wildly upward. Natural gas prices decreased by 0.8%. Gasoline prices also improved this month from September, with prices rising 0.8%, down from last month’s 9.3% increase. Although these developments are better than September’s wild increases, energy prices need to start trending back down significantly to return to baseline. Geopolitical issues continue to weigh on energy prices, fueling their increases, and policymakers need to take this issue seriously. 

Inflation offers little relief before Thanksgiving 

Most indexes increased in October. The general food index rose 0.5% last month, with food at home rising 0.4%, and food away from home jumping up 0.5%. As food affordability challenges families dealing with inflation, understanding the many different factors that contribute to food prices will help policymakers develop effective strategies to deal with trends of increasing prices. With families preparing for Thanksgiving, food prices will be top of mind for many Americans.

This Thanksgiving, travel prices will also be significant for many Americans. As a result of energy inflation over many months, when families drive to visit family or pay for plane tickets this holiday season, they will experience significantly more expensive journeys. From September’s report, gasoline has increased 34.2% in price from 2025, and plane tickets are up 22.4%. These will be major issues as families want to spend time together over the holidays. 

Bottom line

Price rises in October are challenging consumers across the country as they prepare their households for Thanksgiving, both through food and travel inflation. Though October’s inflation numbers have moderated from September’s price jumps, higher prices continue to test households across America.