The guessing game around next week’s Fed meeting is over. August’s inflation report sent the odds of a rate hike surging to 90%, up sharply after core prices climbed 0.3% for the month and 2.4% annually — both hotter than economists expected. For anyone banking on cheaper borrowing soon, rate cuts are looking like next year’s problem.
- Gasoline alone added 3.9% and was the biggest driver of August’s CPI gain — while shelter rose 0.3% for consumers.
- Against the 3.4% headline CPI, average hourly earnings only rose 3.1% — marking a fifth straight month of real wage declines.
Memory squeeze: Computer software and accessories now cost 25.4% more than a year ago, the sharpest annual jump on record. Apple cited an “extraordinary surge” in memory and storage demand from AI data centers when it raised prices in June, then hiked iPhone prices again this week. Microsoft’s Xbox, Nintendo, and Amazon followed suit. Consumer sentiment already cracked in September on rising price worries, and with AI infrastructure spending still accelerating, the tech aisle isn’t done handing bills to shoppers.