US Inflation Posts Biggest Monthly Increase in 2023 as CPI Rises 0.6%
The U.S. Department of Labor released new data today showing a 0.6% increase in the consumer price index (CPI) for August. This is the largest monthly rise in U.S. inflation so far this year. The report showed that prices have gone up by 3.7% compared to August of last year, slightly higher than what economic analysts had predicted.
The CPI is used to measure the average change over time in the cost of goods and services.
Economic analysts, who were polled by Dow Jones, had predicted the increases to be 0.6% and 3.6% respectively.
When food and energy prices are set aside, the core CPI saw an uptick of 0.3% for the month and 4.3% year-over-year. This core index is given more attention by Federal Reserve officials because it offers a clearer picture of long-term inflation trends. During August, energy prices saw a rise of 5.6%, which included a substantial 10.6% jump in gasoline prices.
Food prices went up by 0.2%, while the costs related to housing, which accounts for roughly a third of the CPI's weight, rose by 0.3%. The rent for primary residences increased by 0.5% and showed a 7.8% hike compared to last year. The owners equivalent rent, a metric that assesses what homeowners think they could charge for rent, rose by 0.4% for the month and 7.3% for the year.
The report also revealed that airfares increased by 4.9%, although they are still 13.3% lower than they were a year ago. Prices of used vehicles, which played an important role in boosting the inflation rate in 2021 and 2022, dropped by 1.2% and are now 6.6% lower year-over-year. Transportation services experienced a 2% increase in August.
According to Lisa Sturtevant, the chief economist at Bright MLS, if housing costs were excluded from the CPI, the annual inflation
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