Used cars drive U.S. consumer prices higher in August

Economy

Joel Porro and Lizz Hernandez wear gloves and protective masks as they put bags in the trunk of their car after shopping at Walmart Supercenter as the coronavirus pandemic continues, March 5, 2020 in Miami.

David Santiago | Miami Herald | Tribune News Service via Getty Images

U.S. consumer prices increased solidly in August, but labor market slack is likely to keep a lid on inflation as the economy recovers from the Covid-19 recession.

The Labor Department said on Friday its consumer price index rose 0.4% last month. The CPI advanced 0.6% in June and July after declining in the prior three months as business closures to slow the spread of the coronavirus depressed demand.

In the 12 months through August, the CPI increased 1.3% after gaining 1.0% in July. Economists polled by Reuters had forecast the CPI rising 0.3% in August and climbing 1.2% year-on-year.

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