New data came out on Thursday.

It shows strong U.S. economic growth from July to September.

But it also shows faster inflation.

This mixed picture comes less than a week before midterm elections.

High living costs are a big issue for voters.

The economy grew at a 3.4% yearly rate in the third quarter.

That is up from 2.2% in the previous quarter.

The Commerce Department said this.

Consumer spending rose 3.8% at a yearly rate.

Business investment jumped 12.7%.

Spending on AI infrastructure drove this.

But economists worry about high prices.

High prices are hurting Americans' ability to keep up.

After-tax incomes adjusted for inflation slipped from August to September.

They were up just 1% from a year earlier.

The savings rate fell to 3.8% in September.

That is its lowest level in four years.

TD economist Ksenia Bushmeneva wrote about this.

She wrote that high energy prices are cutting purchasing power.

She wrote that these problems will likely weigh on consumer demand.

Consumer prices rose 3.6% in September from a year earlier.

That is up from 3.4% in August.

Rising gas prices drove much of the increase.

But service costs also rose.

This is a sign that inflation is spreading.

Core inflation picked up to 3.1% from 3%.

The Federal Reserve left its key rate unchanged on Wednesday.

But strong growth and lasting inflation make a rate hike more likely.

This could happen at its December meeting.