The Federal Reserve’s September 2026 projections put median U.S. PCE inflation at 3.7% in 2026, easing to 2.3% in 2027, 2.1% in 2028 and 2.0% in 2029. These are policymakers’ projections—not a guarantee. The latest CPI data available on October 8, 2026, showed prices 3.4% higher than a year earlier in August; September CPI was scheduled for release on October 14.
What is the US inflation forecast for 2026?
The Federal Reserve’s September 16, 2026 Summary of Economic Projections (SEP) gives the following median projections for PCE inflation:
| Period | Median PCE inflation projection |
|---|---|
| 2026 | 3.7% |
| 2027 | 2.3% |
| 2028 | 2.1% |
| 2029 | 2.0% |
| Longer run | 2.0% |
The annual projections are fourth-quarter-to-fourth-quarter percentage changes, not forecasts of the average inflation rate across each calendar year. The longer-run figure is where participants expect inflation to converge under appropriate monetary policy and absent further shocks. These figures are participant assessments reported in the Federal Reserve’s September 2026 projections, not a formal promise by the committee.
How does the forecast compare with the latest inflation data?
The forecast and the latest CPI reading describe different indexes and time periods. In its September 11, 2026 release, the Bureau of Labor Statistics (BLS) reported that the CPI-U was 3.4% higher in August 2026 than in August 2025. The index rose 0.4% from July on a seasonally adjusted basis. Core CPI, which excludes food and energy, increased 2.4% over 12 months and 0.3% over the month.
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Those are observed CPI changes, while the Fed’s table is a future projection for PCE inflation. The Bureau of Economic Analysis (BEA) describes PCE as covering a wide range of consumer expenditures and reflecting changes in what consumers buy. Its latest reading available in the BEA release on September 30 was a 3.5% year-over-year rise in the PCE price index through June 2026. That is a realized PCE reading, not the Fed’s 2026 projection.
For the August CPI report, gasoline prices rose 3.9% and accounted for more than a third of that month’s all-items increase; shelter rose 0.3% and food rose 0.1%. These figures explain part of the reported August movement, but they do not establish what will drive inflation in coming months. The BLS release is available in its August 2026 CPI report.
Why the Fed’s inflation forecast is uncertain
The 3.7% figure is a median, not a unanimous view. For 2026, participants’ projections ranged from 2.9% to 3.8%. The Federal Reserve says each participant based projections on information available at the meeting and an assessment of appropriate monetary policy, including a path for the federal funds rate, as well as assumptions about other factors affecting economic outcomes. New data, policy decisions or unexpected shocks can change the outlook.
When comparing forecasts, check the index (PCE or CPI), whether it is headline or core inflation, the time basis (monthly, trailing 12 months or fourth quarter to fourth quarter), and whether a figure is a median or a range. Those distinctions matter: a monthly CPI change cannot be read as though it were a Fed annual PCE projection.
When will the inflation outlook be updated?
As of October 8, 2026, August was the latest CPI month available. BLS scheduled the September 2026 CPI release for October 14, 2026; check the BLS CPI page and release schedule for the new observation. A CPI update changes the record of measured prices; it does not, by itself, revise the Fed’s September projections.
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