On Friday, the Bureau of Labor Statistics (BLS) released its latest report based on data about the prices of products and services across the U.S., showing that inflation nudged up slightly in August.
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The rise shown in the consumer price index (CPI) report fell in line with Wall Street analysts’ predictions:
The consumer price index rose a seasonally adjusted 0.4% for the month, putting the 12-month increase at 3.4%, the Bureau of Labor Statistics reported Friday. Both readings were in line with the Dow Jones consensus.
However, stripping out volatile food and energy prices, the core CPI posted a 0.3% monthly gain, or 0.1 percentage point higher than forecast. The core annual rate came in at 2.4%, matching the estimate.
As RedState previously wrote, the July and August inflation numbers beat predictions, and were on a positive downward trend.
Here’s a glimpse at what drove the month-over-month inflation number, CNBC reported:
Energy propelled the headline number higher, as gasoline prices jumped 3.9%, accounting for more than one-third of the index’s gain. The energy index broadly rose 2.1% amid pressure from escalating tensions in the Middle East and was up 16.3% from a year ago. Gasoline rose 27.4% and fuel oil surged 52% on a 12-month basis.
Food prices edged 0.1% higher as food at home costs held flat. The food index accelerated 2.7% annually.
Another significant factor was a 0.3% climb in shelter costs, which had moderated over the prior two months. Transportation services saw a 0.5% increase. Used cars and trucks rose 0.4% and new vehicle prices were up 0.3%, part of what appeared to be broad-based gains for the index. Tariff-sensitive apparel prices were flat and motor vehicle insurance fell 0.8%.
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And this is a breakdown of more price changes from August 2025:
Price changes over last year (August CPI report)
Fuel Oil: +52.0%
Gasoline: +27.4%
Gas Utilities: +4.4%
Electricity: +3.8%
Apparel: +3.6%
Overall CPI: +3.4%
Food away from home: +3.4%
Shelter: +3.0%
Medical Care: +2.5%
Transportation: +2.4%
Food at home: +2.2%
New Cars: +0.6%…— Charlie Bilello (@charliebilello) September 11, 2026
Now, experts are considering what this could mean when the Federal Reserve meets next week:
“There’s no guarantee that the Fed will hike next week, but it’s hard to see how the central bank can justify leaving rates on hold,” Chris Zaccarelli, chief investment officer for Northlight Asset Management, said in a statement after the consumer price index (CPI) data was released Friday.
…
The central bank’s rate-setting panel is poised to meet Tuesday and Wednesday, with investors pricing in a nearly 87 percent chance that it hikes rates by a quarter-point, according to the CME FedWatch tool.
White House spokesperson Kush Desai characterized the CPI report as “reinforc[ing] how President Trump’s targeted policy interventions are paying off, with dramatic month-over-month price reductions for beef, prescription drugs, and car insurance.”
“These policies are having a lasting effect for everyday Americans,” he added, “and will continue delivering as energy supplies increase, markets stabilize, and overall inflation declines again.”
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Meanwhile, National Economic Council Director Kevin Hassett said in an interview with Bloomberg after the report’s release that “inflation is clearly decelerating,” which his model had predicted, and the Fed would do whatever it likes based on the CPI report:
“I would say that you just about hit the target and inflation is decelerating,” says National Economic Council Director Kevin Hassett on the heels of this month’s CPI report.
Watch our full interview here: https://t.co/n5u3vI4ucS pic.twitter.com/335nFYHfK5
— Bloomberg TV (@BloombergTV) September 11, 2026
This is a developing story. RedState will provide updates as warranted.
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