Key highlights from the US Consumer Price Index report for August:
📈 The US Consumer Price Index rose by 0.4% in August on a monthly basis, exceeding the average forecast of 0.3%.
📌 As usual, housing costs were the largest factor, and prices for home food jumped by 0.6%, the highest since 2022.
📌Among the driving factors were rising prices for meat and tariff-sensitive tomatoes. The core annual rate reached 2.9%, up from 2.7% in July.
📈The core consumer price index, which excludes food and energy costs, rose by 0.3% month-over-month, in line with expectations and matching the level of the previous month.
📌Airfare, clothing, and new and used car prices increased, while medical care and recreation costs decreased. The annual increase was 3.1%, the same rate as in July.
📌The core inflation indicators showed a slowdown in price pressures, with core goods prices, excluding new and used vehicles, rising by 0.13%, the lowest rate since March, indicating limited overall fee pressures.
📌Basic service costs, excluding housing, rose by 0.33%, down from 0.48% in July according to Bloomberg.
📌While the report confirmed that inflation remains above the Federal Reserve's target, the reassurance that tariff increases are not clearly leading to a general escalation in price pressures bolstered expectations that the Fed will cut interest rates by 25 basis points in next week's meeting.
