WASHINGTON (AP) — As a presidential race deeply shaped by Americans’ frustration with high prices draws to a close, the government said Thursday that a gauge of inflation closely watched by the Federal Reserve has fallen to near pre-pandemic levels.

The Commerce Department reported that prices rose just 2.1 percent in September from 12 months earlier, down from a 2.3 percent year-over-year increase in August. That’s just above the Fed’s 2 percent inflation target and consistent with readings in 2018, well before prices began to rise after the pandemic recession.

On a monthly basis, prices rose 0.2% from August to September, up slightly from a 0.1% increase from July to August.

Taken as a whole, the latest signs of a sustained cooling in inflation come five days before an election in which many voters are bullish on the economy, especially as average prices remain nearly 20 percent higher than they were four years ago. Former President Donald Trump has largely blamed the energy policies of the Biden-Harris administration and vowed that inflation would “completely disappear” if elected. Vice President Kamala Harris has promised to ban food price hikes and lower child care and health care costs.

Economists say Trump’s policies would actually make inflation worse, mainly because of his plans to impose major new tariffs and embark on mass deportations of migrants and other immigrants. Harris’s price hike proposals, experts said, would leave the inflation outlook largely unchanged

Inflation peaked at 7.1 percent in June 2022 as the economy emerged from the pandemic recession at a time of severe parts and labor shortages, according to the gauge released Thursday, called the personal consumption expenditure price index. Inflation has cooled steadily over the past two years as supply chains recovered from pandemic disruptions and the Fed raised its key interest rate to a four-decade high, slowing home sales and car purchases.

The Fed tends to favor the inflation gauge the government released on Thursday — the price index for personal consumption expenditures — over the more widely known consumer price index. The PCE index tries to account for changes in the way people shop when inflation rises. It can surprise, for example, when consumers switch from more expensive national brands to cheaper store brands.

In general, the PCE index tends to show a lower inflation rate than the CPI. In part, that’s because rents, which have been high, account for twice as much in the CPI as the index released on Friday.

Chairman Jerome Powell signaled in late August that the Fed is increasingly confident that inflation is under control. And employment weakened in July and August. These trends prompted the Fed to cut its key rate by half a point last month. As inflation continues to ease, the Fed is expected to cut rates further by a quarter point in November and likely by another quarter point in December.

However, the prospects for future interest rate cuts are not quite clear. Hiring rebounded sharply in September and the unemployment rate fell to a low of 4.1 percent, evidence that the labor market may be stronger than it appeared last summer. Retail sales also rose to a healthy level last month. And on Wednesday, the government estimated the economy expanded at an annual rate of 2.8 percent in the July-September quarter, a solid pace fueled by strong consumer spending.

The upbeat economic data sparked some speculation that the Fed may decide to skip a rate cut in December or cut rates more slowly next year.

On Friday, the government will release its last major economic data before the presidential election: the October jobs report. It is likely to provide a more muddled picture of the labor market than usual, as Hurricanes Helene and Milton are believed to have caused tens of thousands of workers to lose their jobs, at least temporarily.