Fast rising prices continued to trouble the US economy last month, though a drop in petrol costs provided some relief.
The annual inflation rate, the pace at which prices rise, fell to 8.3% in August.
That was down from 8.5% in July, marking a second month of decline.
But the costs of food, housing and medical care continued to surge, disappointing economists expecting more widespread easing.
Shares in the US dropped sharply following the release. The Dow Jones was down more than 2.5 persent in mid-morning trade, while the S&P 500 and Nasdaq fell more than 3%.
