The August Consumer Price Index report, which shows that national inflation is at 8.3 percent after a high of four decades in June, has seen a slight decline, due primarily to sharply falling gas prices. There are still inflation concerns, however, as food prices continue to rise across the country.
Good news for consumers: Gas prices have fallen by approximately 26 percent in the past month. As summer travel ended, airfare has fallen as students return to school.
According to Wall Street Journal, the main concern is the rising prices of food.
The figures show that food prices have risen this month, while prices for a variety of goods and services remain much higher than they were a year ago.
“Consumers are receiving relief at the pump, and there should be more relief at the gasoline station, and at the grocery store,” Ryan Sweet, senior director for economic research at Moody’s Analytics, said.
According to Kathy Bostjancic (chief U.S. economist at Oxford Economics), broad price pressures have been resilient and the Federal Reserve has continued to raise interest rates to combat inflation.
She stated that inflationary dynamics are improving and moving in the right direction. “But they’re still way too hot to be comfortable, whether for individuals or businesses or for the Federal Reserve.”
Inflation was 9.1 percent in June 2021 according to the CPI. That fell to 8.5% in July, which led to the Biden administration declaring that there was “zero inflation” during the month. However, as gas prices fell, inflation declined at a slower rate from July to August. And those pressures on food prices and goods prices are not showing any signs of easing.
Stock futures plunged Tuesday morning as markets react to the release of CPI data. Economists had forecast a lower August annual inflation rate. The 8.3 percent finding sent futures tied to S&P 500 down 1.4 percent, while contracts tied with the tech-oriented Nasdaq fell 1.9 percent.