America In Focus: inflation accelerated in August, home sales weaken and diesel prices soar

The economy, inflation and how those forces could impact the lives of Americans were front and center over the past week. Trips to the grocery store and gas station are more painful than they were last year, and rising costs are impacting the decisions of both households and businesses.

Here’s a snapshot of prominent economic data and news that occurred over the past week and what it potentially means for you.

U.S. inflation accelerated last month as gas prices spiked in the wake of renewed fighting in the Middle East, underscoring the affordability challenges that are top of mind for many voters as midterm elections near.

The Labor Department said Friday that the consumer price index rose 3.4% last month compared with a year ago, the same as in July. But on a monthly basis, inflation accelerated, as costs jumped 0.4% from July to August, up from an increase of just 0.1% the previous month.

The figures show that inflation remains stubbornly elevated, more than five years after prices first soared as the economy emerged from the COVID pandemic. Persistent inflation has presented a major challenge for the inflation-fighters at the Federal Reserve and has soured many voters on the Trump administration’s economic management.

Diesel prices in the U.S. hit yet another record on Friday, soaring past $6 a gallon on average as Washington’s war with Iran disrupts the world’s flow of fuel .

The national average of $6.05 is up from $5.85 last week and $3.70 this time last year, according to motor club AAA.

Higher diesel prices mean more expensive transportation for a long list of everyday goods. That’s because diesel is used for many freight and delivery networks. And some businesses have already passed along steeper costs to consumers in the form of added fees on online orders and packages in the mail .

Wholesale inflation picked up last month after cooling earlier this summer as higher oil and gas prices stemming from the Iran war keep costs elevated.

The Labor Department’s producer price index — which captures inflation before it reaches consumers — rose 5.4% in August from a year ago, up from 4.8% in July , the government said Thursday. Annual wholesale inflation peaked this year at 5.9% in May after the Iran conflict raised energy costs. On a monthly basis, wholesale prices increased 0.4% from July to August, after a 0.1% increase the previous month.

Inflation has shown some signs of easing in recent months but is still high , frustrating consumers who are struggling with more expensive gas, groceries, clothing and other essentials. U.S. oil prices topped $100 a barrel Thursday on renewed fighting in the Middle East, while President Donald Trump has intensified a trade war with Canada , a sign tariffs still could push up costs. Rising prices pose a political problem for the Trump administration and Republicans running in the midterm elections.

Sales of previously occupied U.S. homes declined in August to their slowest annual pace in more than a year as home shoppers grappled with rising mortgage rates and home prices.

Existing home sales fell 2% last month from July to a seasonally adjusted annual rate of 3.98 million units, the National Association of Realtors said Thursday. This is the third straight monthly decline.

Sales also fell 1.2% compared with August last year. The latest sales tally is just shy of the 4 million pace economists were expecting, according to FactSet.

Mortgage rates rose for the third week in a row, pushing the average long-term U.S. home loan rate to its highest level in over 14 months.

The benchmark 30-year fixed rate mortgage rose to 6.76% from 6.71% last week, mortgage buyer Freddie Mac said Thursday. One year ago, the average rate was 6.35%.

Higher mortgage rates can add hundreds of dollars a month in costs for borrowers, limiting homebuyers’ purchasing power. As rates rise, that can also lead prospective home shoppers to delay buying a home, one reason U.S. home sales remain largely stagnant again this year.

The average rate is now the highest it’s been since June 26, 2025, when it was at 6.77%.

Borrowing costs on 15-year fixed-rate mortgages, often sought by borrowers refinancing a home loan, also rose this week. That average rate increased to 6.09% from 6.04% last week. A year ago, it was at 5.5%.

Slightly fewer Americans filed for unemployment claims last week as jobless claims remain at historically low levels and layoffs are still relatively rare.

Filings for benefits dipped to 206,000 last week from a revised 207,000 the week before, the Labor Department reported Thursday. The four-week average of claims, which smooths out week-to-week volatility, also fell modestly to 206,000.

Claims for jobless benefits are a proxy for layoffs, and economists watch them because they can be a sign of where the job market is headed. For the past year, claims have mostly stayed within a historically low range of 200,000 to 230,000 a week.

U.S. stocks rebounded Friday after oil prices eased, but markets struggled to end the week positive. An update on inflation across the United States that came in close to economists’ expectations also helped calm the market.

The S&P 500 rose and was on track to break a four-day losing streak, its longest since June. The Dow Jones Industrial Average and the Nasdaq also climbed.

They got some help from a pullback in oil prices, which jumped earlier this week to their highest levels since May because of the ongoing war with Iran . The price for a barrel of Brent crude, the international standard, fell 3% to $104.42 after getting near $110 overnight.