Economists are mixed on what the Federal Reserve will do at its meeting later this month, but inflation worries — which eased when energy prices started tumbling in late July — reared up again on Friday, when the Commerce Department reported that core inflation rose in August. The 2.5 percent rise in this measure over the past 12 months was the biggest year-long increase since a similar 2.5 percent 12-month rise in April 1995.

Goss wrote Friday that "supply managers report that recent declines in oil prices have reduced inflationary pressures. I expect this to push the Federal Reserve Open Market Committee to hold on interest rate hikes at its next meeting."

Also Monday, the Commerce Department reported that a big gain in commercial construction spending was enough to offset a decline in home building in August. Construction spending edged up 0.3 percent to a seasonally adjusted annual rate of $1.20 trillion, the best showing in five months.

The report said spending on private home construction dropped 1.5 percent in August to a seasonally adjusted rate of $617 billion. The August decline followed an even bigger 2.1 percent July decrease and marked the fifth straight month home building has fallen.

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