Inflation rises 3.4% in August in last report before Fed’s interest-rate decision

Inflation in August remained steady, but a key data point came in slightly hotter than expected – leaving the odds of an interest-rate hike next week up in the air.

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The Consumer Price Index rose 3.4% on an annual basis, still stubbornly above the Fed’s 2% goal but in line with economists’ forecasts and the same rate as July,  the Bureau of Labor Statistics said Friday. On a monthly basis, it rose at a 0.4% pace.

Core CPI – which excludes volatile food and energy prices, giving a better picture of underlying inflation – jumped 2.4% over the past 12 months. It rose 0.3% over the month, slightly hotter than estimates of a 0.2% rise.

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Meanwhile, gasoline prices continued to skyrocket, rising 3.9% and accounting for more than a third of the overall inflation rate.

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This is a developing story. Please check back for updates.