Inflation heated up last month, boosting the case for a Fed rate hike

By Elisabeth Buchwald, CNN

(CNN) — Consumer prices rose at a 3.4% annual rate last month, the same pace as July, according to the latest Consumer Price Index from the Bureau of Labor Statistics.

That likely strengthens the case for a Federal Reserve rate hike to tame inflation and prevent price increases from becoming more entrenched.

Inflation has accelerated since the war with Iran began, and central bankers are watching to determine whether price pressures are spreading through the economy. Fed officials are set to meet next week to decide the next move on interest rates.

On a monthly basis, prices rose 0.4%, an acceleration from July’s 0.1% rate.

Inflation is also increasingly appearing beyond the pump: When stripping out food and energy costs, so-called core inflation rose 2.4% in the 12 months ending in August, down from 2.5% in July. On a monthly basis, core rose 0.3%.

This story is developing and will be updated.

The-CNN-Wire
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