The Fed is widely expected to cut interest rates next week by a quarter of a percentage point.<\/p>\n
The new data is unlikely to derail those forecasts but the uptick in inflation is poised to keep policymakers cautious as they weigh rate cuts in the months ahead. <\/p>\n
“President Donald Trump’s inflationary policies – tariffs and restrictive immigration measures – are gradually showing up in the hard data and continue to erode consumers’ purchasing power,” said Atakan Bakiskan, US economist at banking group Berenberg.<\/p>\n
Trump has dismissed concerns that his policies will drive up prices or weigh on the economy.<\/p>\n
Since Trump latest tariffs took effect last month, most goods entering the US face taxes of between 10% and 50%, depending on their origin.<\/p>\n
The price of tariff-sensitive products – such as clothing and household goods – inched up last month in a sign that more businesses might be passing on costs to consumers.<\/p>\n
Economists noted that the uptick in food prices, which tend to be volatile, might also be driven in part by Trump administration policies, including tariffs and mass deportations.<\/p>\n
Inflation data showed that tomato prices rose by 4.5% in August.<\/p>\n
About 70% of tomatoes consumed in the US are imported from Mexico, according to the Florida Tomato Exchange.<\/p>\n