Consumer Prices Up 3.4% in the Year to August 2026: What the Cost-of-Living Averages Hide
Consumer prices were 3.4% higher than a year earlier in August 2026, up from a rate of 2.9% in August 2025. This page sets that all-items rate beside food, shelter, medical care, energy, prescription-drug and wage-growth series from U.S. Bureau of Labor Statistics and the Federal Reserve Bank of Atlanta.
What Do the National Cost-of-Living Measures Show in 2026?
The Bureau of Labor Statistics Consumer Price Index for All Urban Consumers put prices 3.4% higher than a year earlier in August 2026, up from a rate of 2.9% in August 2025, by American Default's calculation from the seasonally adjusted index (CPIAUCSL). BLS's own headline 12-month figure uses the unadjusted index and can differ slightly. The headline CPI is a national index with component weights; it is not a household-specific budget or cost-of-living estimate.
Looking for the 2026 Social Security COLA? It is 2.8% and is based on CPI-W, a different index from the CPI-U measure and the category indexes on this page.
Shelter prices were 3% higher than a year earlier, down from a rate of 3.6% in August 2025. Medical care prices were 1.6% higher than a year earlier, down from a rate of 3.5% in August 2025, and energy prices were 16% higher than a year earlier, up from a rate of 0.4% in August 2025. The all-food index, which covers food at home and away from home, was 2.6% higher than a year earlier, down from a rate of 3.2% in August 2025. The separate Food-at-Home cumulative change since January 2020 is 32.0% through August 2026. These series use different categories and, for the cumulative food measure, a different comparison window.
In August 2026, median hourly pay growth in the Atlanta Fed's tracker data ran 0.7 percentage points ahead of our CPI rate. That aggregate comparison supplies no household budget weights, so it cannot establish an effective inflation rate for an income group or individual household. See our cost of living glossary entry for definitions.
Key Statistics at a Glance
The American Distress Index currently reads 47.0 (Typical). The composite itself sits higher than 44% of all published quarters since 2005. Cost of living is context for the index rather than a direct input. The aggregate personal saving rate was 4.1% in August 2026, and 37% of adults in the latest SHED (2025 survey) would not pay a $400 expense entirely with cash or its equivalent: they would use another method or could not pay. Most of them would pay another way, so that share is not an inability rate. These separate measures do not identify the same households or establish that price changes caused later missed payments.
How Do the Displayed CPI Categories Compare?
Consumer prices were 3.4% higher than a year earlier in August 2026. A rate above zero means the basket still costs more than a year earlier, whether the rate is speeding up or slowing down. During 2021–2023 the all-items rate on this basis reached 9.0% in June 2022. In 2022 the energy rate reached 41.5% (June 2022); in August 2026 energy prices were 16% higher than a year earlier. The chart places each series beside the others without assigning a household-specific weight to any of them.
Shelter prices were 3% higher than a year earlier in August 2026. That is the lowest rate since August 2021. Shelter is not rent alone: most of its weight is owners' equivalent rent, and it leaves out home prices and mortgage payments. These price series describe observed index changes; they do not identify why a category changed or how much any particular household spent on it.
CPI 12-Month Change by Category (Monthly, 2018–Present)
Bureau of Labor Statistics seasonally adjusted CPI-U series; 12-month percent changes calculated by American Default. Overall CPI uses CPIAUCSL.
Full data: CPI Inflation · Shelter CPI · Energy CPI
Category Comparison — Current Rates and a Year Earlier
| Category | 12-month change | Month | Versus a year earlier | Note |
|---|---|---|---|---|
| Overall CPI | 3.4% | August 2026 | Up from 2.9% (August 2025) | All items, CPIAUCSL |
| Energy | 16.0% | August 2026 | Up from 0.4% (August 2025) | 2022 high: 41.5% (June 2022) |
| Shelter | 3.0% | August 2026 | Down from 3.6% (August 2025) | Rent, owners’ equivalent rent, hotels and tenants’ insurance |
| All food (home and away) CPI | 2.6% | August 2026 | Down from 3.2% (August 2025) | Food at home since January 2020: +32% |
| Healthcare / Medical Care | 1.6% | August 2026 | Down from 3.5% (August 2025) | −1.8 percentage points against all items |
| Prescription Drugs | -2.9% | August 2026 | Down from 0.9% (August 2025) | Unadjusted index from January 2017 |
All CPI categories tracked: Food CPI · Medical CPI · Energy CPI · Rx Drug CPI
How Much Have Food-at-Home Prices Changed Since 2020?
In August 2026, food-at-home prices were 32% higher than in January 2020, seasonally adjusted. That is the total change over the period, not a yearly rate. The separate all-food CPI series, which includes food at home and food away from home, was 2.6% higher than a year earlier. A year-over-year rate measures recent change, while a cumulative index change measures the price-level movement from its starting month. That index-wide change is not a grocery bill for any household, because starting costs and purchase mixes differ.
Food-at-home prices can be compared with shelter, healthcare, income, and household financial measures, but the aggregate series do not establish one fixed sequence into hardship withdrawals or SNAP participation. Those outcomes have distinct populations, eligibility rules, and causes.
Cumulative Food-at-Home Price Change Since January 2020
Computed from seasonally adjusted BLS Food-at-Home CPI (CUSR0000SAF11). Rebased so January 2020 is the zero baseline.
Full data: Grocery Price Statistics
How Does Medical Care Inflation Compare With Overall CPI?
In the 12 months to August 2026, medical care price growth trailed all-items price growth by 1.8 percentage points. The gap is down from 0.5 percentage points in August 2025. It is the lowest reading since January 2024. The gap is American Default's subtraction of two seasonally adjusted BLS rates, in percentage points. It measures price growth only, not what households paid, and it does not say why the two rates differ.
Neither series establishes a household-specific effective rate or a connection to delinquency. For separately sourced medical-debt measures, see our medical debt and healthcare cost statistics.
Medical Care CPI Minus All-Items CPI (Monthly, percentage points, 2018–Present)
Computed from seasonally adjusted BLS CPI-U series (medical care CUSR0000SAM, all items CPIAUCSL). Zero line = equal to overall CPI.
Full data: Healthcare CPI Premium
How Does the Aggregate Wage Measure Compare With CPI?
In August 2026, median hourly pay growth in the Atlanta Fed's Wage Growth Tracker data ran 0.7 percentage points ahead of our CPI rate. The gap is down from 1.1 percentage points in August 2025. During 2021–2023 the gap's lowest reading was -2.7 percentage points, in March 2022. A monthly gap does not measure cumulative purchasing power or an individual worker's pay.
The wage input is the Atlanta Fed's unsmoothed monthly median of individual 12-month pay changes, not the three-month average it headlines, and the CPI comparator is a national price index. Differences by occupation, income, or household spending pattern require their own sources and weights; this series alone cannot supply them.
Wage Growth vs. CPI Spread (Monthly, percentage points, 2015–Present)
Atlanta Fed Wage Growth Tracker data (unsmoothed median) minus seasonally adjusted BLS CPI-U (CPIAUCSL) 12-month change. Positive = median pay growth ahead of CPI; negative = behind.
Full data: Wage-CPI Spread · Lower-income wage growth vs. inflation gap (The K-Shape)
National Category Indexes Are Not Household Budgets
CPI is a national index across goods and services with national component weights. The category rates on this page show how each index moved, but they cannot calculate an effective inflation rate for a family without that family's spending weights and matching price measures.
The aggregate personal saving rate, SHED emergency-expense responses, and hardship withdrawals measure different populations and outcomes. They provide financial-distress context, but the displayed price indexes do not establish that price changes caused those outcomes.
Read more: Savings Rate Statistics →Data Sources and Methodology
CPI measurement basis: Every CPI reading and historical comparison on this page uses its source-owned basis unless explicitly identified otherwise: Year-over-year percent change computed from the seasonally adjusted CPI-U all-items index (CPIAUCSL); seasonally adjusted values may be revised when BLS updates seasonal factors; Year-over-year percent change computed from the seasonally adjusted BLS Food CPI (CUSR0000SAF1); seasonally adjusted values may be revised; Cumulative percent change since January 2020 computed from the seasonally adjusted BLS Food-at-Home CPI (CUSR0000SAF11); seasonally adjusted values may be revised; Year-over-year percent change computed from the seasonally adjusted BLS Medical Care CPI (CUSR0000SAM); seasonally adjusted values may be revised; Percentage-point difference between year-over-year changes in the seasonally adjusted Medical Care CPI (CUSR0000SAM) and seasonally adjusted all-items CPI-U (CPIAUCSL); seasonally adjusted values may be revised; Year-over-year percent change computed from the seasonally adjusted BLS Shelter CPI (CUSR0000SAH1); seasonally adjusted values may be revised; Year-over-year percent change computed from the seasonally adjusted BLS Energy CPI (CUSR0000SA0E); seasonally adjusted values may be revised; Year-over-year percent change in the BLS prescription drug CPI, series CUSR0000SEMF01. BLS has published prescription drugs as not seasonally adjusted since its 2022 review, and this series' values equal the unadjusted index from January 2017; earlier values are seasonally adjusted.
Bureau of Labor Statistics CPI
All price data come from the BLS Consumer Price Index for All Urban Consumers (CPI-U), published the month after the month it covers. American Default computes 12-month changes from these seasonally adjusted series: All Items (CPIAUCSL), all food at home and away from home (CUSR0000SAF1), Food at Home for the cumulative grocery measure (CUSR0000SAF11), Shelter (CUSR0000SAH1), Medical Care (CUSR0000SAM) and Energy (CUSR0000SA0E). BLS has published prescription drug prices without seasonal adjustment since its 2022 review. Our prescription drug series, CUSR0000SEMF01, matches the unadjusted index from January 2017 on; its values before 2017 are seasonally adjusted. BLS headlines 12-month changes computed from unadjusted indexes, so our figures can differ from BLS's by about a tenth of a point.
Atlanta Fed Wage Growth Tracker
The Atlanta Fed's tracker data give the median 12-month change in hourly pay for workers matched in the Current Population Survey a year apart. This page uses the unsmoothed monthly median and subtracts our CPI rate. The result is our calculation, not the Atlanta Fed's published tracker and not BLS's real earnings figure.
Computed Indicators
The medical care gap is the Medical Care 12-month rate minus the all-items 12-month rate, in percentage points, calculated by American Default. The grocery cumulative measure compares each month's Food-at-Home index with January 2020.
American Distress Index
Cost-of-living data is context for the American Distress Index rather than a direct input. The index reads the downstream ledger — delinquency, defaults, debt burden, labor, and the savings buffer. Current score: 47.0.
Frequently Asked Questions
What is the current U.S. inflation rate?
Consumer prices were 3.4% higher than a year earlier in August 2026, up from a rate of 2.9% in August 2025. That is American Default's calculation from the Bureau of Labor Statistics' seasonally adjusted Consumer Price Index for All Urban Consumers (CPI-U, series CPIAUCSL); BLS headlines a 12-month figure from the unadjusted index, so the two can differ by about a tenth of a point. A rate above zero means the basket still costs more than a year earlier, whether the rate is speeding up or slowing down. The Board of Governors of the Federal Reserve System's 2% longer-run inflation objective is defined using PCE inflation rather than CPI.
How fast are prices rising by category?
Over the 12 months to each category's latest month, by our calculation from BLS indexes: all items up 3.4%, energy up 16%, shelter up 3%, food at home and away from home up 2.6%, medical care up 1.6% and prescription drugs down 2.9%. These are national category indexes, not an inflation rate for a particular income group or household. For grocery-specific data, see our grocery price statistics.
Are wages keeping up with inflation?
In August 2026, the median 12-month change in hourly pay in the Atlanta Fed's Wage Growth Tracker data ran 0.7 percentage points ahead of our CPI rate. The gap is down from 1.1 percentage points in August 2025. The gap is American Default's subtraction of the unsmoothed monthly median from the Atlanta Fed and the seasonally adjusted CPI-U; it is not BLS's official real earnings figure, and it does not describe any one worker's pay or household's costs.
How does cost of living connect to the American Distress Index?
Cost of living is context for the American Distress Index rather than a direct input. The index separately tracks measures including delinquency, debt, labor conditions, and the aggregate personal saving rate. This page does not infer that a change in one price category caused a later missed payment or saving-rate movement. The index currently reads 47.0 (Typical). The composite itself sits higher than 44% of all published quarters since 2005.