US inflation accelerated last month as gas prices spiked after renewed fighting in the Middle East, with the consumer price index rising 3.4 percent from a year earlier in August. Monthly inflation also picked up to 0.4 percent from July, while core prices rose 0.3 percent on the month. The report increased pressure on the Federal Reserve ahead of its Sept. 15-16 meeting, and Wall Street traders saw a more than 80 percent chance of a rate hike.
Fuel prices are displayed outside a truck stop on Sept. 4 in Fairview, Tenn. AP-Yonhap
WASHINGTON — U.S. inflation accelerated last month as gas prices spiked in the wake of renewed fighting in the Middle East, underscoring the affordability challenges that are top of mind for many voters with midterm elections now just seven weeks away.
The consumer price index rose 3.4 percent last month compared with a year ago, the Labor Department said Friday, just like July. But inflation quickened month to month as costs jumped 0.4 percent from July, quadrupling the 0.1 percent registered in the previous month.
Inflation remains stubbornly elevated more than five years after prices soared as the economy emerged from the pandemic. Friday's report increases pressure on the inflation-fighters at the Federal Reserve to boost their benchmark interest rate next week, which could lift mortgage and auto loan costs in the months ahead.
