Fed's Rate Dilemma Deepens as Growth Firms and Prices Climb

The U.S. economy grew a little recently, according to the Federal Reserve.

Businesses hired slightly more people, but prices continued to rise.

Higher energy, transportation, materials and tariff costs worried many companies.

Some customers were buying fewer expensive items, such as home improvements.

The Federal Reserve must decide whether to raise interest rates or leave them unchanged.

Raising rates could help slow price increases, but it could also make borrowing harder.

Some policymakers favor a rate increase, while others want more evidence before changing rates.

The decision will be discussed at the Federal Reserve’s September meeting.

Artificial intelligence and data-center construction are helping some industries even as housing and other sectors weaken.