(NewsNation) — Continued falling prices gave Americans a break for the second month in a row from sky-high inflation.
Inflation slowed to a still-high 8.3% in August, the Bureau of Labor Statistics reported Tuesday. This is a slowdown from July’s figure of 8.5% and a four-decade high of 9.1% in June. On a monthly basis, prices rose 0.1%, after a flat reading in July.
Sharply lower prices for gas and cheaper used cars slowed inflation, but many other items rose in price, indicating that inflation remains a heavy burden for American households.
The Federal Reserve has hiked interest rates in its quest to tame inflation, and it looks to the monthly inflation trends to help determine its rate decisions at future meetings.
Despite the signs of moderating price increases, inflation remains far higher than many Americans have ever experienced and is keeping pressure on the Federal Reserve, the agency tasked with keeping prices stable. The Fed is expected to announce another big increase in its benchmark interest rate next week, which will lead to higher costs for many consumer and business loans.
The consumer price index report affects the cost of living for 70 million people who are on Social Security and for 34 million renters signing or renewing leases.
Inflation has escalated families’ grocery bills, rents and utility costs, among other expenses, inflicting hardships on many households and deepening gloom about the economy despite strong job growth and low unemployment.
Even if inflation peaks, economists expect it could take two years or more to fall back to something close to the Fed’s annual 2% target. The cost of rental apartments and other services, such as health care, are likely to keep rising in the months ahead.
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The Associated Press contributed to this report.