U.S. market indexes began down as inflation data revealed price pressures are more persistent than expected, denting expectations central bankers may reduce interest-rate hikes.
S&P 500 fell 2.1% Tuesday. The Nasdaq Composite fell 2.8% while the DJIA fell 1.6%.
The Labor Department's CPI for August showed annual inflation of 8.3%, the final big inflation figure before the Fed's meeting next week.
Consumer prices grew 8.5% from a year earlier in July, slower than June's 9.1% annual gain.
Inflation is dropping, but more slowly than investors and experts expected. The Wall Street Journal expected consumer prices to jump 8% in August.
Investors hoped regulators will slow rate hikes if inflation continued to moderate. The inflation statistics dampened optimism.