Business, Finance & Tech
U.S. Inflation Holds at 3.4% as Fuel Prices Drive August Increase
U.S. consumer prices rose 3.4% in August compared with a year earlier, matching the inflation rate recorded in July, according to new data from the Bureau of Labor Statistics.
Prices increased 0.4% from July to August, a significant acceleration from the 0.1% monthly increase recorded in July. Gasoline prices jumped 3.9% in August and accounted for more than one-third of the overall monthly increase in consumer prices.
The latest report comes just days before the Federal Reserve’s next policy meeting, scheduled for Sept. 15-16. The stronger monthly inflation reading could add pressure on policymakers as they consider whether interest rates need to remain elevated or increase.
Core inflation, which excludes food and energy prices, rose 0.3% in August and was up 2.4% from a year earlier. Shelter costs, airline fares, vehicle prices and wireless services were among the categories contributing to the increase.
Energy prices remain a major concern. The broader energy index rose 2.1% in August and was up 16.3% over the past year. Gasoline prices were 27.4% higher than a year earlier.
A separate Producer Price Index report released Thursday also showed inflation pressures at the wholesale level. Producer prices increased 5.4% over the 12 months ending in August, while diesel fuel prices rose sharply.
The increase in fuel costs has been linked by economists to the ongoing conflict involving the United States and Iran and its effects on global energy supplies. AAA reported the national average price of diesel surpassed $6 per gallon Friday for the first time.
Higher fuel costs can affect consumers beyond the gas station because diesel is widely used to transport food, merchandise and other goods.
The latest inflation figures will be among the data Federal Reserve officials consider as they meet next week to decide the direction of interest rates.
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By: NBC Palm Springs
September 12, 2026
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