US inflation worsened last month as the cost of gas, food and airfares jumped

By CHRISTOPHER RUGABER, Associated Press Economics Writer

WASHINGTON (AP) — Inflation moved higher last month as the price of gas, groceries, hotel rooms and airfare rose, along with the cost of clothes and used cars.

Consumer prices rose 2.9% in August from a year earlier, the Labor Department said Tuesday, up from 2.7% the previous month and the biggest increase since January. Excluding the volatile food and energy categories, core prices rose 3.1%, the same as in July. Both figures are above the Federal Reserve’s 2% target.

The reading is the last data the Fed will receive before its key meeting next week, when policymakers are widely expected to cut their short-term rate to about 4.1% from 4.3%. Still, the figures underscore the challenges the Fed is facing as it experiences relent