The data came just hours before the Bank of Japan voted to cut its key interest rate for the first time in more than seven years.
The bank cut the uncollateralized overnight call rate from 0.5 percent to 0.3 percent, joining other central banks in focusing on growth rather than inflation as the global financial crisis threatens to tip major developed economies into recession.
Core inflation, which excludes fresh food prices, jumped 2.3 percent during the month from a year earlier on still-high fuel and food costs, according to the Ministry of Internal Affairs and Communications. Although the result marks the 12th consecutive month of increase for the core consumer price index, it is slower than August’s 2.4 percent rise.
Fuel costs in particular are cooling, with gasoline prices rising 20.7 percent in September, down from 26.4 percent in August.
Economy Minister Kaoru Yosano said there would be a time lag until consumers significantly benefit from lower crude oil prices but described the current CPI level as "healthy", according to Kyodo news agency.
"The reason why crude oil prices declined is because the age for feverish oil buying came to an end," Kyodo quoted Yosano as saying. "The outlook for global demand for crude oil seems to be weakening a bit."
A series of weak economic data recently point to broader gloom ahead.
The government reported Friday that average monthly household spending fell 2.3 percent from a year earlier to 281,433 yen ($2,862).
While the figure was better than the 3.4 percent average decline forecast by Kyodo news agency, the fall is nonetheless bad news for an economy dependent on consumer spending for growth. Individual spending accounts for more than half of Japans gross domestic product.
Also, the latest industrial output data released Wednesday showed that production is expected to fall 2.3 percent in October and 2.2 percent in November, as exporters including automakers scale back sharply.
The benchmark Nikkei 225 stock average jumped nearly 10 percent Thursday, spurred by growing expectations of a rate cut. It closed down 5 percent Friday, partly because the cut was smaller than the quarter percentage point reduction that markets had expected.
Core CPI for the Tokyo area, considered a leading indicator of prices nationwide, rose 1.5 percent in October after increasing 1.7 percent in September.
So-called "core-core" inflation, which excludes both food and energy, inched up 0.2 percent.
Separately, the government said that Japans seasonally adjusted unemployment rate in September stood at 4.0 percent, down 0.2 percentage point from the previous month.
The number of jobless increased by 20,000 to 2.71 million, the Ministry of Internal Affairs and Communications said.