Fed Faces Timing Dilemma as Inflation Persists and Economy Grows

Stubborn inflation and strong economic growth have shifted the Federal Reserve's focus from whether to raise interest rates again to when it should happen.

Inflation in August was 3.4%, an improvement from July but still above the Fed's target of 2%. Core prices, which exclude volatile food and energy categories, rose 3% compared to last year.

The economy grew at a 2.2% pace in the second quarter, despite a slowdown from the first quarter.

Economists and investors expect another rate increase before the end of the year, possibly as soon as next month, due to sustained consumer spending and economic growth.