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CPI continues slow rise despite uncertainties around consumer demand
In August, overall consumer prices rose 0.4 percent on a seasonally-adjusted basis. Additionally, the Bureau of Labor Statistics reported that the overall consumer price index (CPI) grew 1.3 percent over the 12-month period.
"Reports of plummeting housing prices in some urban areas have either not shown up yet in the CPI aggregate or are being offset by increases in suburban areas," said NAFCU Chief Economist and Vice President of Research Curt Long in a new Macro Data Flash report. "The outlook for consumer demand is uncertain at best, given the enormous contraction in fiscal support for households.
“Inflation is unlikely to be problematic for the Fed anytime soon, and the benchmark federal funds rate is expected to remain at zero for several years,” he added.
Energy prices rose 0.9 percent during the month, following a 2.5 percent rise in July. Long noted that despite the increases, they are well-below year ago levels (-9.1 percent). Food growth was up 0.1 percent in August and rose 4.1 percent on a year-over-year basis.
Core prices (excluding food and energy costs) rose 0.4 percent in August. Year-over-year core CPI growth was 1.7 percent.