If you felt the effects of rising prices last month, it wasn’t your imagination. The Labor Department reports the August Consumer Price Index (CPI) jumped 0.6% from July. Over the last 12 months, the inflation rate is 3.7%.
The price of gasoline was the biggest driver of inflation. The price at the pump surged 10.6% from July but was down 3.3% from August 2022. AAA reports gas prices have plateaued at about the same level as a month ago.
Housing costs also continued to rise in August, climbing 0.3%. For the last 12 months, the shelter index is up 7.3%.
Food prices also continued to rise but at a less dramatic pace. Grocery prices – food consumed at home – were up 0.2% for the month and 3% over August 2022.
The cost of food consumed away from home – mostly at restaurants – rose 0.3% from July and is up 6.5% over the last 12 months.
Signs of relief
But other parts of the economy began to show signs of relief. The index for used cars and trucks fell 1.2% in August, after decreasing 1.3% in July.
The recreation index declined 0.2 percent over the month, and the communication index declined 0.1%.
The cost of medical care services rose only 0.1% after falling 0.4% in July. For the last 12 months, these costs are down 2.1%.
Oliver Rust, head of product at independent inflation data aggregator Truflation, says the big increase in inflation did not take anyone by surprise.
“As many commentators have observed, this has been driven by rising oil prices, which have surged by 25% since July,” Rust told ConsumerAffairs. “This has driven up the cost of gasoline, which accounted for over half of the total increase in CPI in August.”
Rust says core inflation - which strips out volatile energy and food prices - also increased by 0.3% in August, after rising 0.2% in July. He says that was a disappointment since policymakers were hoping to see a softening that might signal a meaningful decline in inflation.