US consumer prices rose about 3% in the year to August, the Bureau of Labor Statistics reported Thursday, a reading that traders said all but locks in an interest-rate cut at the Federal Reserve's meeting next week. Core inflation, excluding food and energy, remained sticky near 3%.

The report followed soft labour-market data, including August payroll gains that fell short of expectations. Fed policymakers, led by Chair Jerome Powell, have signalled growing concern about employment even as inflation lingers above the central bank's 2% target. Markets had priced in a quarter-point reduction ahead of the release.

Economists at Goldman Sachs and Morgan Stanley had forecast headline CPI in the 2.9% to 3.1% range, with tariff-related goods prices adding upward pressure. Shelter and services costs continued to moderate, while import duties imposed under President Donald Trump raised prices for some consumer goods, according to BLS category data.

US equity futures and Treasury yields moved modestly after the release, as investors judged the print consistent with a September cut rather than a larger move. The CME FedWatch tool showed traders assigning high odds to a 25-basis-point reduction at the September 15-16 meeting.

Analysts said an in-line report removed a key obstacle to easing. The Federal Reserve is due to announce its rate decision the following week, with updated economic projections.