A Walmart employee and shoppers in an aisle.
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The Consumer Price Index gained 8.3% year-over-year in August, the government said Tuesday.
The reading showed inflation slowing from the prior pace of 8.5% but missing the 8.1% forecast.
Falling gas prices offset rising costs of food, new cars, and heating, according to the report.
Inflation is proving much more difficult to tame than expected.
The Consumer Price Index climbed 8.3% in the year through August, the Bureau of Labor Statistics announced Tuesday. Economists surveyed by Bloomberg expected the measure to slow to 8.1%. The report reflects a sizeable deceleration from the 8.5% pace observed in July and the slowest headline inflation since April.
The index also rose 0.1% in August alone, landing above the median forecast for a 0.1% drop.
The print marks a second straight month of easing inflation after more than a year of blistering acceleration. June seems to mark the peak of pandemic-era inflation, with the one-year rate now down more than a percentage point from that reading. The future remains uncertain, and several factors, including supply-chain snags and holiday shopping, could lift price growth for some time. Yet with interest rates on the rise and Americans’ demand fading, the latest CPI report backs up the narrative that inflation is squarely on the way back down.
Energy prices counted for much of the August slowdown, with costs falling 5% through the month. Prices at the pump contributed significantly, as waning demand and rebounding supply have reversed much of the run-up seen through the spring and early summer. The gas-price index fell 10.6%, and average prices seen through early September signal the downtrend will last into the fall.
Used vehicle prices also helped slow inflation. The prices of previously owned cars and trucks slid 0.1% in August, further reversing the rally that helped pull inflation higher in early 2021.
However, underlying price-growth dynamics may be harder to tame than the headline gauge suggests. Core CPI inflation, which strips out volatile food and energy prices, rose 6.3% in the year through August, coming in above the median forecast of a 6.1% pace. That marked an uptick from the 5.9% year-over-year rate seen in July. The core measure is generally regarded as a better measure of inflation trends, and the latest data shows prices in much of the economy are still on the rise.
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