Inflation Rises 3.4% Annually in August 2026, Gas Prices Surge

The consumer price index rose 3.4% annually in August 2026, unchanged from July, according to the Bureau of Labor Statistics. Gasoline prices increased nearly 4% in August and are over 27% higher than in August 2025, averaging about $4.30 per gallon. These increases are attributed to tensions in the Middle East, which have restricted oil supplies. The data suggests that the Federal Reserve may increase interest rates at its upcoming meeting to manage inflation, which has been above the target for over five years, impacting consumers who rely on borrowing.