Fed rate hike in September is all but guaranteed after CPI report, economists say

TL;DR

August's Consumer Price Index rose 3.4% annually, exceeding forecasts and accelerating core price increases.
The likelihood of a Federal Reserve interest rate hike at the September 16th meeting has jumped to nearly 90%.
Higher gasoline prices contributed significantly to the monthly inflation increase.
Economists anticipate a 0.25 percentage point rate hike, bringing the federal funds rate to 3.75%-4%.
Further rate hikes are projected for December and March 2027 by some analysts.
Interest rate hikes would increase borrowing costs for consumers but boost returns for savers.
Recent spikes in oil and diesel prices, exacerbated by geopolitical conflicts, are raising concerns about sustained inflation.
Some Federal Open Market Committee members have signaled willingness to hike rates due to unsatisfactory disinflation progress.

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