Consumer prices rose at annualized rate of 2.9% in August: federal government

The U.S. economy's Consumer Price Index increased in August at an annualized rate of 2.9%, the Bureau of Labor Statistics reported Thursday.

The annual rate increased 0.2% from July, when it was 2.7%. The annual and monthly increases were in line with economist's expectations, the agency also reported.

The index is considered the country's most accurate indicator of inflation. 

The numbers are being closely watched amid President Trump's tariff increases and whether the Federal Reserve will lower its benchmark interest rate, in large part to lower the cost of mortgage rates. However, lowering the rate could also increase inflations, some economists say. 

Month over month, prices rose 0.4% compared to July's 0.2% increase.

Economists and policymakers are striving for an annual 2% interest rate.