U.S. Consumer Prices Rose 0.3% in August

The cost of living in the U.S. climbed in August for a second month as energy and food prices increased, while other goods and services showed little change.

The consumer-price index rose 0.3 percent for a second month, figures from the Labor Department showed today in Washington. Excluding volatile food and fuel costs, the so- called core rate was unchanged.

While demand is strong enough to avert an extended and broad-based decline in prices, companies such as Wal-Mart Stores Inc. and Kroger Co. are offering discounted merchandise to attract shoppers. A limited risk of inflation is one reason economists project the Federal Reserve will hold interest rates close to zero until late next year.

In the 12 months ended in August, prices rose 1.1 percent following a 1.2 percent year-over-year gain the prior month.

The core rate rose 0.9 percent from August 2009. The year- over-year core has increased 0.9 percent each month since April, matching the smallest gain since 1966.

Energy costs increased 2.3 percent from a month earlier, and food costs rose 0.2 percent.

Owners-equivalent rent, one of the categories designed to track rental prices, was unchanged after rising 0.1 percent in July and June. Apparel prices and air fares both declined 0.1 percent in August. The cost of medical care increased 0.2 percent.

U.S. Consumer Prices Rose 0.3% in August

TradingEconomics.com, Bloomberg
9/17/2010 2:05:35 PM