WASHINGTON (AP) — Inflation rose last month as the prices of gas, groceries and air fares jumped, according to a new federal government report.
Consumer prices increased 2.9 percent in August from a year earlier, the Labor Department said, up from 2.7 percent the previous month and the biggest increase since January.
Excluding the volatile food and energy categories, core prices rose 3.1 percent, the same as in July. Both figures are above the Federal Reserve’s 2 percent target.
On a monthly basis, overall inflation accelerated, as prices rose 0.4 percent from July to August, faster than the 0.2 percent pace the previous month. Core prices rose 0.3 percent for the second straight month.
Gas prices jumped 1.9 percent from July to August, the biggest monthly increase since a 4 percent rise in December. Grocery prices climbed 0.6 percent, pushed higher by more expensive tomatoes, apples and beef.
The cost of travel also rose, with air fares rising 5.9 percent from July to August and hotel room prices rising 2.3 percent.
Rental costs also increased, rising 0.4 percent, faster than the previous month. Clothing costs rose 0.5 percent last month, though they are still just slightly more expensive than a year ago.
Furniture costs rose 0.3 percent and are 4.7 percent higher than a year earlier. Appliance costs also rose from July to August, after falling the previous month.
Some restaurant owners say they have boosted prices to offset the rising costs of food. Cheetie Kumar, who owns Mediterranean eatery Ajja in Raleigh, N.C., said she’s facing higher costs on everything ranging from spices she imports from India, coffee and chocolate she gets from Brazil, to soy she gets from Canada.
“Those are things that I cannot source locally, we do source a lot of produce and meat and everything else from local farmers, but I don’t know any nutmeg growers in North Carolina,” she said.
Her overall costs are up about 10 percent from a year ago, with beef costs up 7 percent, and much bigger increases for things such as coffee, chocolate (300 percent) and spices (100 percent).
She’s raised prices on some of her menu items by $1 or $2, but said she’s at the limit of how much she can do so before demand wanes and she stops earning a profit.
Some national retailers and brands haven’t spelled out specific price hikes but many, including Home Depot and Macy’s, have described them as modest or say they are taking a surgical approach.
Walmart and other big chains have warned of costs increases as they replenish their inventories, with the full impact of tariffs in effect.