August CPI shows sticky core inflation ahead of Fed meeting

An interest rate hike may be in store after data from the U.S. Bureau of Labor Statistics, released on Friday, shows that core inflation is remaining stubbornly above the Federal Reserve’s desired target. In August, the Consumer Price Index for all items rose 0.4% month-over-month up from a 0.1% monthly jump in July. A 3.9% month-over-month jump in the index for gasoline contributed to over one-third of the monthly all items index increase. Overall, the energy index rose 2.1% month-over-month in August. “Inflation regained momentum in August, with higher energy prices lifting the headline rate and stubborn services prices keeping underlying inflation pressures alive,” Sam Williamson, First American’s senior economist, said in a statement. On a yearly basis, inflation was up 3.4% in August, the same as in July. Core inflation, also known as the all items less food and energy index, rose 0.3% in August after a 0.2% monthly increase in July. On a year-over-year basis, the all items less food and energy index rose 2.4%, down from a 2.5% jump in July. Indexes that contributed to the monthly jump of the all items less food and energy index include communication (+2.3%), airline fares (+2...