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US inflation fell to 2.4 per cent in September but still exceeded expectations, cementing expectations that the Federal Reserve will cut interest rates by a quarter point at its next meeting in November. Thursday’s headline figure from the Bureau of Labor Statistics was below August’s 2.5 per cent annual increase but above economists’ expectations of 2.3 per cent. The figure, the last before the November 5 presidential election, came after the Fed cut rates by a larger-than-usual half point last month amid signs that it was succeeding in its battle to tame price pressures. After the release of the inflation data, as well as figures showing a jump in joblessness, investors increased their bets on a quarter-point cut at the US central bank’s November meeting. Markets were pricing in a roughly 90 per cent chance of such a cut in November following the data, compared with 80 per cent beforehand. The interest rate-sensitive two-year Treasury yield, which moves inversely to prices, was down 0.06 percentage points to 3.96 per cent on Thursday afternoon. The S&P 500 fell, closing 0.2 per cent below Wednesday’s record-high closing level.