Inflation is again outpacing wage growth in the U.S.

U.S. workers are seeing their paychecks lose ground as inflation has once again moved ahead of wage growth. Consumer prices rose 3.4% in August from a year earlier, while average hourly earnings increased 3.1%, leaving real wages slightly lower. Economist Heather Long said the shift reflects a renewed squeeze on household budgets after several months of improvement. She pointed to higher energy costs, especially gasoline, as a major driver of the recent pickup in inflation. The pressure is already affecting spending patterns, with more households turning to discount and warehouse retailers to stretch their money. Long said inflation may remain difficult to bring down quickly if energyrelated pressures persist and wage growth continues to cool.