US Economy Hit Hard by Soaring Diesel Prices and Accelerating Inflation

The US economy is facing challenges as inflation accelerated in August, driven by rising gas prices. The Labor Department reported that the consumer price index rose 3.4% last month compared to a year ago, with costs increasing by 0.4% from July to August.

The national average of diesel prices soared past $6 a gallon on Friday, hitting a record high as Washington's war with Iran disrupts fuel supplies. Higher diesel prices will increase transportation costs for everyday goods and some businesses have already passed these costs along to consumers in the form of added fees.

Wholesale inflation also picked up last month, rising 5.4% from a year ago, driven by higher oil and gas prices. The Labor Department's producer price index rose 0.4% from July to August, after a 0.1% increase in the previous month.