US Consumer Prices Accelerate in August, Increasing Pressure for Fed Rate Hike

Summary · in our words

US consumer prices rose at a faster pace in August, driven largely by higher energy costs, pushing inflation further above the Federal Reserve's target and intensifying debate over another interest rate increase. Gasoline prices were a primary contributor to the monthly acceleration, reversing recent declines and adding broad upward pressure across the index. Core inflation, which strips out food and energy, rose more moderately on a monthly basis, offering a mixed picture for Fed policymakers. The Federal Open Market Committee faces a decision on whether to raise its benchmark rate further as it weighs persistent price pressures against signs of cooling in parts of the economy.