US Inflation Climbs to 3.4% in August Amid Strong Consumer Spending
The US Bureau of Economic Analysis (BEA) reported that inflation rose by 3.4% in August, as measured by the Personal Consumption Expenditures (PCE) price index. This marks a year-over-year increase from the same month in 2025. The PCE price index excluding food and energy also rose by 3.0% during this period.
Consumer spending saw a significant jump of 0.9% in August, with goods and services both contributing to the growth. Personal consumption expenditures rose by $190.7 billion, while personal income increased by $66.6 billion or 0.2% at a monthly rate.
The increase in consumer spending was largely driven by higher compensation and government social benefits, according to the BEA. The PCE price index itself saw a 0.3% increase from July to August, with the index excluding food and energy rising by 0.2%.