US Inflation Hits 3.4% as Gas Prices Surge
US inflation has picked up pace as gas prices have spiked following renewed fighting in the Middle East, according to data released by the Labor Department. The consumer price index rose 3.4% last month compared with a year ago, matching the rate from July.
The inflation rate remains stubbornly elevated, more than five years after prices first soared as the economy emerged from the COVID-19 pandemic. On a monthly basis, inflation quickened to 0.4% from July to August, up from an increase of just 0.1% the previous month.
The figures have put pressure on the Federal Reserve (Fed) to boost the benchmark interest rate at its meeting next week, which could lift mortgage and auto loan costs in the months ahead. Fed officials 'signaled that interest rates can remain on hold only if disinflation continues,' said Kathy Bostjancic, chief economist at Nationwide.