Lower gas costs slowed U.S. inflation in August, but most other prices across the economy kept rising — evidence that inflation remains a heavy burden for American households.
WASHINGTON — 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.
Stock prices tumbled and bond yields rose on the worse-than-expected core figures, with many investors fearful that the Federal Reserve will turn even more aggressive in its drive to curb inflation. The Dow Jones industrial average sank nearly 900 points in mid-day trading. Inflation is higher than many Americans have ever experienced, escalating families’ grocery bills, rents and utility costs, among other expenses. It has deepened gloom about the economy despite strong job growth and low unemployment.
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. Though much of the food is donated, Crouch said her organization buys some of it and has faced sharp increases in meat and dairy prices in the past few months.
Yet Americans are still desperate for cars, Buckberg said, which has allowed dealers to keep their markups much higher than pre-pandemic levels. New car prices, which rose 0.8% in August, have climbed nearly 11% in the past year.Ongoing price increases for raw materials — and labor — have left many small businesses struggling. Some are raising their own prices to keep up, only to then lose customers, according to a survey by Goldman Sachs 10,000 Small Business Voices.
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