US Inflation Pressures Fed

August inflation stayed high, keeping pressure on the Fed to consider another rate hike.

•Center & Right

Latest Inflation Report for August Shows Slight Rise Ahead of Next Fed Meeting

The Fed Is Poised to Raise Interest Rates for the First Time in Years

August was brutal for consumers. September could be worse

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Analysis & opinion

The reporting

A neutral summary of the key facts most outlets agree on, drawn from reporting across the political spectrum.

U.S. consumer prices rose 3.4% in August from a year earlier, unchanged from July, while the Consumer Price Index increased 0.4% from July as gasoline and other energy costs kept pressure on household budgets. The Sept. 11 report strengthened market expectations that Fed Chair Kevin Warsh and policymakers will raise interest rates next week, with fed-funds futures pricing odds at about 86%, up from about 72% a day earlier. Treasury yields stayed near multiyear highs, while U.S. stocks rebounded as oil prices eased, with the Dow up about 500 points.

Analysis & opinion

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Fed hike caseLeans Left

August’s inflation data makes looser monetary policy harder to justify and strengthens the case for the Federal Reserve to keep rates high or raise them again. Persistent price pressures, especially alongside strong jobs data, make another rate hike a real possibility.

Consumer squeezeLeft & Center

Households are likely to feel more financial strain in the near term as inflation remains stubborn. Rising energy costs and broader price pressures could make conditions worse for consumers in September and beyond.