The personal consumption expenditures (PCE) price index rose 0.3 per cent from the previous month, following a revised 0.1 per cent increase in July, the Commerce Department said.
Economists had expected a 0.4 per cent rise.
Compared with a year earlier, PCE inflation stood at 3.4 per cent in August, unchanged from a revised 3.4 per cent in July.
Core PCE inflation, which excludes volatile food and energy prices, rose 0.2 per cent month-on-month, slightly below expectations of 0.3 per cent.
Core prices had increased by a revised 0.1 per cent in July.
On an annual basis, core PCE inflation remained unchanged at 3.0 per cent in August.
The PCE price index is closely watched by the Federal Reserve as a key measure of inflation.
Separate figures in the Commerce Department's report showed personal income rose 0.2 per cent in August after increasing 0.3 per cent in July.
Personal spending, meanwhile, jumped 0.9 per cent after edging up 0.1 per cent in July.
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