US consumer spending in August grew at the fastest pace in more than a year, providing momentum for economic growth even as inflation persists.

Data released Wednesday by the US Bureau of Economic Analysis showed that inflation-adjusted personal spending rose 0.6% in August from the previous month, the largest single-month increase since March 2025.

The personal consumption expenditures (PCE) price index, the inflation gauge favored by the Federal Reserve, rose 0.3% month over month. After excluding food and energy, the core PCE price index climbed 0.2%.

The figures released Wednesday once again indicate that despite elevated inflation, the US economy continues to push forward.

Helped by a stable job market and rising stock prices, consumers increased spending last month on goods such as automobiles, furniture, and clothing, withstanding high gasoline prices and broadly rising costs across the economy.

Federal Reserve officials are closely monitoring inflation and spending data to determine when to raise interest rates again. The Fed implemented its first rate hike in three years this month.

The September employment report due on Friday, along with more inflation and consumer data expected in the coming weeks, will provide a more complete picture of the US economy before the Fed makes its rate decision on October 28.