Research
October 14, 2026
Menu Prices
Consumer prices jumped in September, fueled by higher gas prices, with solid menu price growth
Consumer prices rose 0.6% in September, accelerating from a 0.4% increase in August and marking the strongest monthly gain since April. Higher energy costs drove much of the increase, with gasoline prices surging 9.1% in September and standing 34.2% above year-ago levels, adding to headline inflation and putting further pressure on household budgets. By contrast, food prices were unchanged in September after modest 0.1% gains in both July and August, while restaurant menu prices increased 0.2%. As a result, headline consumer inflation climbed to 3.7% year over year in September, its highest reading since May.
Core CPI, which excludes the often-volatile food and energy categories, increased 0.3% for the second consecutive month. Core inflation moved up from 2.4% to 2.6% year over year, reaching a three-month high. Price increases in September were led by used cars and trucks (+0.7%), transportation services (+0.6%), shelter (+0.4%), apparel (+0.3%), and medical care services (+0.3%). Offsetting some of these gains, prices declined for medical care commodities (-0.7%) and household furnishings and supplies (-0.4%).
The September pickup in inflation was largely expected given the sharp increase in energy prices. With oil prices continuing to move higher amid ongoing tensions in the Middle East and disruptions to shipping through the Strait of Hormuz, inflationary pressures are likely to remain elevated in the near term.
The Federal Open Market Committee raised short-term interest rates at its September meeting and is widely expected to increase the federal funds rate again before year-end. While the broader economy has remained resilient, inflation continues to run above the Federal Reserve’s target, reinforcing the need for policymakers to remain focused on restoring price stability. If inflation does not show more sustained progress toward the Fed's objective, additional policy tightening could remain on the table in 2027.
In the food away from home category, menu prices at fullservice restaurants rose 0.3% in September, down from 0.4% in August. So far this year, fullservice restaurant menu prices have also averaged 0.3% growth per month, a solid pace. Meanwhile, menu prices at limited-service restaurants increased 0.2% in September after being flat in August, with average monthly growth of 0.2% year to date. On a year-on-year basis, fullservice restaurant menu prices grew 3.8% since September 2025, with 3.2% growth year-on-year for limited-service businesses.
Within the broader food-away-from-home category, food prices at employee sites and schools rose 0.5% in September, averaging 0.6% growth over the past four months. At the same time, prices for food from vending machines and mobile vendors declined 0.2% in September after jumping 1.2% in August, with an average of 0.3% over the past four months. Food prices at other food away from home locations edged up 0.1% in September following strong growth in July and August, with a 4-month average of 0.5%.
Year-over-year, prices at vending and mobile vendors rose 3.8% since September 2025, with prices at employee sites and schools up 2.0% year-over-year. The broader “other food away from home” category posted a 4.0% annual increase in prices in September over the past 12 months.
Core CPI, which excludes the often-volatile food and energy categories, increased 0.3% for the second consecutive month. Core inflation moved up from 2.4% to 2.6% year over year, reaching a three-month high. Price increases in September were led by used cars and trucks (+0.7%), transportation services (+0.6%), shelter (+0.4%), apparel (+0.3%), and medical care services (+0.3%). Offsetting some of these gains, prices declined for medical care commodities (-0.7%) and household furnishings and supplies (-0.4%).
The September pickup in inflation was largely expected given the sharp increase in energy prices. With oil prices continuing to move higher amid ongoing tensions in the Middle East and disruptions to shipping through the Strait of Hormuz, inflationary pressures are likely to remain elevated in the near term.
The Federal Open Market Committee raised short-term interest rates at its September meeting and is widely expected to increase the federal funds rate again before year-end. While the broader economy has remained resilient, inflation continues to run above the Federal Reserve’s target, reinforcing the need for policymakers to remain focused on restoring price stability. If inflation does not show more sustained progress toward the Fed's objective, additional policy tightening could remain on the table in 2027.
Menu prices continued to increase solidly
Menu prices rose 0.2% in September, following 0.3% increases in both July and August, matching the average monthly gain seen so far in 2026. Compared with a year earlier, menu prices were up 3.5% in September. While restaurant inflation remains elevated relative to historical norms, it has continued to ease from the exceptionally strong increases experienced in the years immediately following the pandemic.
Grocery prices edged up 0.1% in September after remaining unchanged in July and August, offering some relief after stronger price growth earlier in the year. Through the first nine months of 2026, food-at-home prices increased an average of 0.2% per month. Over the past 12 months, grocery prices have risen 1.8%, roughly half the pace of menu price inflation.
In the food away from home category, menu prices at fullservice restaurants rose 0.3% in September, down from 0.4% in August. So far this year, fullservice restaurant menu prices have also averaged 0.3% growth per month, a solid pace. Meanwhile, menu prices at limited-service restaurants increased 0.2% in September after being flat in August, with average monthly growth of 0.2% year to date. On a year-on-year basis, fullservice restaurant menu prices grew 3.8% since September 2025, with 3.2% growth year-on-year for limited-service businesses.
Within the broader food-away-from-home category, food prices at employee sites and schools rose 0.5% in September, averaging 0.6% growth over the past four months. At the same time, prices for food from vending machines and mobile vendors declined 0.2% in September after jumping 1.2% in August, with an average of 0.3% over the past four months. Food prices at other food away from home locations edged up 0.1% in September following strong growth in July and August, with a 4-month average of 0.5%.
Year-over-year, prices at vending and mobile vendors rose 3.8% since September 2025, with prices at employee sites and schools up 2.0% year-over-year. The broader “other food away from home” category posted a 4.0% annual increase in prices in September over the past 12 months.
