Sharply lower prices for gas and cheaper used cars slowed U.S. inflation in August for a second straight month
Lower gas costs slowed U.S. inflation for a second straight month in August, but most other prices across the economy kept rising - evidence that inflation remains a heavy burden for American households.
Further Fed rate hikes could weaken growth so much as to push the economy into a recession. Some economists now expect the Fed to raise its benchmark short-term rate, currently in a range of 2.25% to 2.5%, to 4.5% or higher. That would make it even harder for the central bank to meet its goal of achieving a "soft landing, whereby it tames inflation without causing a recession.
Grocery prices continue to rise rapidly, jumping 0.7% from July to August. In the past year, they have soared 13.5% - the biggest 12-month increase since 1979. In his speeches, Biden has generally stopped referring to the impact of inflation on family budgets. He has instead highlighted his administration's recent legislative accomplishments, including a law enacted last month that's intended to reduce pharmaceutical prices and fight climate change.
Elaine Buckberg, chief economist at General Motors, said the pandemic disruptions to overseas production of semiconductors, which have slowed auto output, have significantly dissipated and that overall supply chain disruptions have improved about 80% from the worst days of the pandemic.
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