Higher gas prices lift Fed's preferred inflation gauge but underlying price pressures remain mild

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Higher gas prices lift Fed's preferred inflation gauge but underlying price pressures remain mild
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An inflation gauge closely tracked by the Federal Reserve accelerated in August, boosted mainly by higher gas prices.

But measures of underlying inflation slowed in the latest sign that overall price pressures are still moderating.

Core prices rose just 0.1% from July to August, down from July's 0.2%. Compared with a year ago, core prices rose 3.9%, down from July's year-over-year increase of 4.2%. How much a shutdown would weaken the economy would depend on how long it lasts. A short closure probably won’t have much impact on the economy. But it would likely have a more far-reaching impact than previous shutdowns did because a larger portion of the government will close.

Higher gas prices are also eating up a bigger share of Americans’ paychecks, with the average national price for a gallon of gas hitting $3.84 on Thursday, up seven cents from a year ago.

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