US Military Strikes Iranian Rocket Launchers on Strait of Hormuz

The US military launched its first attack on Iran in over a month, targeting Iranian rocket launchers on the Strait of Hormuz. This move came after a lull in activity in the ongoing war with Iran, which has lasted more than six months.

Oil prices surged 2.8% to $90.59 per barrel as Brent crude rose following the attack. The price swing between $72 and $102 last month amid rising and falling hopes for a deal to end the war had already made oil expensive, with the national average for gasoline in August hitting above $4 per gallon every day of the month for the first time ever.

The higher energy prices due to the war have fueled stubbornly high inflation, weighing on household spending and consumer confidence. The rate of inflation remains well above 3%, far beyond the Fed's 2% target, giving the Federal Reserve a more complicated path ahead for its interest rate policy.