United States: Annual inflation slows in August as consumer prices register first monthly decline since early 2013
August 19, 2014
In August, consumer prices decreased 0.2% over the previous month in seasonally-adjusted terms, which contrasted the 0.1% rise recorded in July. The result marked the first monthly decline since April of last year and undershot market expectations of a flat reading. The decline was underpinned by much lower prices for energy, including gasoline, as well as lower prices for transportation.
Annual inflation decreased from 2.0% in July to 1.7% in August. Meanwhile, core consumer prices, which exclude food and energy prices, were flat over the previous month (July: +0.1% month-on-month). The reading came in below market expectations of 0.2% and marked the weakest result since January 2010. Annual core inflation increased 1.7% in August (July: 1.9%), while annual average core inflation ticked down from 1.8% to 1.7% in August.
Author: Carl Kelly, Economist