US INFLATION SURGES IN AUGUST, DRIVEN BY ENERGY AND HOUSING COSTS
By Jonathan Toh
August saw the most pronounced inflationary rise of the year, according to a recent report from the U.S. Department of Labor. This spike was largely attributed to a jump in energy prices and hikes across various items, such as, airfares, used vehicles, medical care and personal care.
Sourced: U.S. Department of Labor
The consumer price index (CPI), which measures the average change in prices for goods and services, rose by a seasonally adjusted 0.6% in August, marking a 3.7% increase from last year, closely aligned with projections by economists, who had anticipated a 0.6% monthly and 3.6% annual increase.
One key factor in August’s inflation rate was energy costs, surging by 5.6%, a figure buoyed by a substantial 10.6% increase in gasoline prices. Additionally, shelter costs (rent and housing cost), which hold significant weight in the CPI, rose by 0.3%.
However, the core CPI which excluding volatile food and energy (a metric the Federal Reserve pays close attention to for its long-term inflationary outlook) increased by 0.3% for the month and 4.3% for the year.
Naturally, the inflation data played a role in the Federal Reserve’s decision to keep the interest rate unchanged. However, the Fed also suggests an anticipation of another rate hike before the year’s end, with potentially fewer cuts than previously projected.
If you have any questions or comments, please email me at firstname.lastname@example.org
Copyright: © This publication is copyright. Subject to the conditions prescribed under the Copyright Act, no part of it may, in any form, or by any means (electronic, mechanical, microcopying, photocopying, recording or otherwise) be reproduced or transmitted without permission. Enquiries should be addressed to GFM Wealth Advisory.