Consumer Price Index Shows Slowest Growth Since February 2021
The Consumer Price Index (CPI) for August 2024 increased by 2.0% compared to the same month in the previous year, marking the slowest growth rate since February 2021. This figure is a decrease from the 2.5% increase recorded in July 2024. The decline in inflation is attributed to lower gasoline prices, which fell by 5.1% year-over-year, influenced by both a base-year effect and current market conditions. Excluding gasoline, the CPI rose by 2.2% in August, down from 2.5% in July.
On a month-over-month basis, the CPI decreased by 0.2% in August, following a 0.4% increase in July. This monthly decline was primarily driven by reduced prices in several categories, including air transportation, gasoline, clothing and footwear, and travel tours.
The mortgage interest cost index continued to rise, albeit at a slower rate of 18.8% year-over-year, down from a peak of 30.9% in August 2023. Despite this slowdown, mortgage interest costs remain the largest contributor to the overall CPI increase since December 2022. When excluding mortgage interest costs, the CPI rose by 1.2% year-over-year in August 2024.
In the clothing and footwear sector, prices fell by 0.6% month-over-month, a notable trend as August typically sees increased demand due to back-to-school shopping. Year-over-year, clothing and footwear prices have decreased for eight consecutive months, down 4.4% in August following a 2.7% decline in July.
Grocery prices saw a year-over-year increase of 2.4% in August, influenced by higher prices for dairy products and fresh fruit. However, month-over-month grocery prices decreased by 0.2%, largely due to a seasonal decline in fresh vegetable prices, which fell by 2.8%. The next CPI release is scheduled for October 15, 2024.
