Inflation Accelerates as Gas Prices Soar Amid Middle East Tensions

US inflation accelerated in August as gas prices surged due to renewed fighting in the Middle East. The consumer price index rose 3.4% last month compared with a year ago, according to the Labor Department. This is the same rate of increase as July.

The monthly inflation rate quickened, with costs jumping 0.4% from July to August. This is up from an increase of just 0.1% in the previous month.

Prices for appliances, car repairs, and wireless phone services also rose last month. Economists worry that higher fuel costs could spread to other areas of the economy.

The Federal Reserve may raise interest rates at its next meeting to combat inflation. This would increase mortgage and auto loan costs in the coming months.