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Fed’s Rate Decision May Have Come Down to Phone Plan Changes
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The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational. (Bloomberg) -- A record jump in the price of cellular phone services helped tip a key measure of US inflation above forecasts, likely sealing the deal for a Federal Reserve interest-rate increase next week. Most Read from Bloomberg Trump's $5,000 Payout Promise Underscores GOP Midterm Peril Apple to Unveil $2,000 Foldable iPhone Duo at High-Stakes Event Toyota Unveils $2,500 Go-Kart in Bid to Grow Motorsports Fans OpenAI Is Open to Slowing Cutting-Edge AI, CEO Sam Altman Tells Staff PlayStation Ditched Hideo Kojima's 'Physint' on Budget Concerns, Missed Deadlines The consumer price index excluding food and energy climbed 0.3% in August from a month earlier, according to Bureau of Labor Statistics data out Friday. The median estimate in a Bloomberg survey called for a 0.2% increase. The 5.9% surge in wireless telephone services prices alone added about a 10th of a percentage point to the core reading. That gauge largely reflects prepaid and monthly plans offered by cellular carriers. Economists at Bank of America Corp., Barclays Plc and Pantheon Macroeconomics flagged recent plan changes by major carriers like AT&T Inc. and T-Mobile US Inc. as likely culprits. The BLS declined to elaborate on how the changes at those carriers may have impacted the number. AT&T said earlier this year that it would implement price increases on certain plans in August. T-Mobile also recently retired some of its legacy plans, resulting in price increases for consumers. Even so, many Fed-watchers still saw a case for raising interest rates, even if underlying inflation was lifted last month partly by one-time factors. "While it is true that the wireless index added 10bps to the core CPI today, and that the core ex-wireless would have been 0.20%, I don't think the Fed will have the luxury of slicing and dicing the data at the meeting next week," Omair Sharif, president of Inflation Insights LLC, said in a note. --With assistance from Kelcee Griffis. Most Read from Bloomberg Businessweek Fusion Gets $14 Billion Bet It's More Than a 'Science Project' Where Does Spirit Go When It Dies? The Companies Trying to Cash In on Trump's Deep-Sea Gold Rush The Sealed Document TikTok Doesn't Want Two Senators to See Crypto Fans Say Stablecoins Are Good for the Dollar. The Truth Is More Complicated ©2026 Bloomberg L.P.
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