US inflation shows signs of weakening in August amidst rise in Delta variant

The gasoline index surged 2.8 percent in August, against the 2.4 per cent breached in July

 

United States consumer goods rates rose less than anticipated in August.

 

The US Labor Department said on Tuesday that as inflation showed signs of weakening amidst the rise of Delta variant-driven Covid-19 and continued supply constraints.

 

As per to a report by the department's Bureau of Labor Statistics, the consumer price index (CPI) surges 0.3 percent in August after breaching 0.5 per cent in July.

 

The Xinhua news agency reported that the updated figure fell markedly from the 0.9 percent growth pace in June.

 

The report also showed that over the past 12 months through August, the index surged 5.3 percent, slightly declined from the 5.4 percent pace in June and July.

 

Apart from the volatile food and energy components, the so-called core CPI slightly rose 0.1 percent last month after surging 0.3 percent in July and it escalated by 0.9 percent in June.

 

The report also showed that as comparing against with a year earlier, the core CPI breached 4 percent in August, also a edged up by 4.3 percent growth in July.

 

Diane Swonk, who is an chief economist at a major accounting firm, Grant Thornton said in a blog, "Inflation has begun to show signs of cooling in response to the Delta variant but the level of prices remains extremely elevated, especially for big-ticket items."

 

Swonk noted that new vehicle rates, in particular, surged 1.2 percent in August and were up a colossal 7.6 percent from a year ago.

 

Swonk said, " The shortages of dealer inventories are so acute that some smaller dealerships are worried about to run out of business."

 

She added, "They can't carry the costs of overhead without the vehicles to sell.

 

As per to the Bureau of Labor Statistics, the food index surged 0.4 percent in August after major breaches in the recent months, with the index for meats, poultry, fish, and eggs surging over 0.7 percent in the month and the beef index breached 1.7 percent.

 

At the same moment, the energy index, increased for the third consecutive month by 2.0 percent in August.

 

The gasoline index surged 2.8 percent in August, against the 2.4 per cent breached in July.

 

Swonk said that the basics needs of food and energy costs are also uplifted, which is ruffling consumer budgets.

 

She also noted that energy rates are anticipatied to move even higher given the destruction to the refining facilities following Hurricane Ida.

 

She said the destruction took the commuting costs for low-wage workers who cannot work from home.

India Scanner News Network

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