US inflation rises to 2.9% in August
US inflation ticked up to 2.9% in August 2025.
Prices rose faster than expected, with the Consumer Price Index (CPI) climbing 0.4% from July, a bit more than economists predicted.
Core inflation steady at 3.1%
If you ignore food and energy (which are always bouncing around), core inflation held steady at 3.1%.
That means for most things you buy regularly, price hikes aren't getting worse—even if overall living costs are up.
Fed still likely to cut rates soon
Even with this jump in inflation, the Federal Reserve is still expected to lower interest rates soon.
Why? The job market is looking a bit weaker these days, and Fed Chair Jerome Powell seems more focused on that slowdown than on rising prices right now.
Traders are betting there's almost no chance the Fed will skip a rate cut at their next meeting.