US inflation slows to 8.3% in August but prices still rising

theguardian.com:

Prices in the US surged again in August but the pace of inflation slowed for the second consecutive month as energy costs fell.

The Consumer Price Index (CPI), the Bureau of Labor Statistics’ monthly cost of living survey, found prices were 8.3% higher last month compared to August last year. The figure was down from an annual rate of 8.5% recorded in July and 9.1% in June, the highest rate in four decades.

Falling gas prices were the major contributor to the drop. Gas prices have fallen for 13 weeks in a row. Nationally, a gallon of gas currently costs an average of $3.71, according to AAA, down from a high of over $5 in June.

Used and new car prices – once a major driver of inflation – fell, as did airfares.

But the prices of other goods and services are still rising.

Prices overall rose slightly over the month, 0.1% higher than July. And after stripping out energy and food costs prices rose 6.3% over the last 12 months, up from 6.1% in July. The increases were broad-based with prices for shelter, food and medical care rising fastest.

The food index increased 11.4% over the last year, the largest 12-month increase since the period ending May 1979.

While the headline rate of inflation has slowed, it still leaves inflation at a rate unseen in four decades. The news comes as the Federal Reserve weighs another sharp increase in interest rates as it struggles to bring price rises under control.

Many parts of the US economy remain strong, most notably the jobs market and household spending. The Fed chair, Jerome Powell, last month warned that the central bank would use its tools “forcefully” to bring prices down and said there would pain ahead, a signal that he expects the Fed’s policy to slow job gains and spending.

The Fed is