US Economy Hits Record High Gas Prices Amid Persistent Inflation

The US economy is facing rising costs and stubborn inflation, with gas prices climbing to their highest levels in years. The Labor Department reported that consumer price index rose 3.4% last month compared to a year ago, with monthly inflation accelerating by 0.4%. This follows the trend of rising diesel prices, which hit a record high past $6 a gallon on average.

The wholesale price index also picked up in August, increasing 5.4% from a year ago due to higher oil and gas prices caused by the ongoing conflict in the Middle East. The inflation rate has been above 3% for more than five years, posing challenges for the Federal Reserve's efforts to control it.

Rising mortgage rates are also affecting home sales, with existing home sales falling 2% last month from July to a seasonally adjusted annual rate of 3.98 million units. The average long-term US home loan rate rose to its highest level in over 14 months, making borrowing costs more expensive for homebuyers.