Inflation ticked up
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inflation, Fed
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Consumer prices were up 2.9% in August from a year earlier, hotter than July’s gain of 2.7%. The year-over-year reading was the highest since the start of 2025.
After a weak jobs report, the producer and consumer price indices for August could be the next worry for the markets and the Fed.
Thursday's consumer-price index for August included an annual core inflation rate of 3.1%, which has remained above 2% since April 2021. It may take a recession to lower this rate to 2% in the next several years.
US headline CPI has come in at 0.4% month-on-month, above the 0.3% consensus, but core CPI has come in at 0.3% as predicted. Read more here.
The crosscurrents of higher prices and a softening job market pose a major headache for Fed policymakers as they prepare to meet next week.
Inflation ticked up for the fourth month in a row, rising in line with forecasts, as higher tariff rates trickle into prices for consumer goods. The consumer price index climbed 2.9% year over year in August,