Inflation Report Looms Amid Spiking Oil Prices and Rate Uncertainty

Friday's inflation report is set to be among the most consequential in years, according to economists and Federal Reserve officials. The report comes amid spiking oil prices, rising interest rates, and uncertainty about the Fed's next move.

The nationwide average cost of a gallon of gas jumped 7% from a month ago to $4.28 on Thursday, with gas prices reaching record highs on Labor Day. Diesel fuel prices have also reached all-time highs.

The Federal Reserve is split on whether to hike interest rates at its meeting next week, and Friday's inflation report could determine their decision. If the monthly core figure rounds up to 0.3%, some analysts expect the Fed to hike rates, but if it rounds down to 0.2% or lower, a hold could be more likely.

Kathy Bostjancic, chief economist at Nationwide, said that 'this is not one and done' and that the effects of higher gas prices could spread through more of the economy, including air fares and shipping costs.