The Consumer Price Index (CPI) increased 2.5% over the prior year in August, a deceleration from July's 2.9% annual gain in prices.
A closely watched report on US inflation showed consumer prices rose in August at the slowest pace in three years on an annual basis, according to theThe Consumer Price Index increased 2.5% over the prior year in August, a deceleration compared to July's 2.9% annual gain in prices and the lowest annual rate since early 2021. The yearly increase was also in line with economist expectations.
Although it is moderating, inflation has remained above the Federal Reserve's 2% target on an annual basis. However, recent economic data,"This isn’t the CPI report the market wanted to see," Seema Shah, chief global strategist at Principal Asset Management, wrote in reaction to the report. "With core inflation coming in higher than expected, the Fed’s path to a 50 basis point cut has become more complicated.
The food index increased 2.1% in August over the last year, with food prices rising 0.1% month over month — proving to be a sticky category for inflation. The index for food at home was unchanged from July to August while food away from home increased 0.3%. U.S. Federal Reserve Chair Jerome Powell holds a press conference following a two-day meeting of the Federal Open Market Committee on interest rate policy in Washington, U.S., May 1, 2024. REUTERS/Kevin LamarquePresident Joe Biden, Vice President Kamala Harris, former President Donald Trump and running mate J.D. Vance will all attend 9/11 memorial ceremonies Wednesday in New York City, the Pentagon and Pennsylvania.
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