Beneath the Skin of CPI Inflation: “Core CPI” Again Accelerates Month-to-Month Fueled by Hot “Core Services” CPI. Durable Goods Prices Drop Further 

By Wolf Richter for WOLF STREET

Second month-to-month acceleration in a row. Year-over-year, Core CPI and Core Services CPI show first acceleration since March this on a month-to-month basis in a most unwelcome development, “core services” re-accelerated for the second month in a row in August, to 5.0% annualized, which fueled the re-acceleration of the overall Consumer Price Index (CPI) and Core CPI.  Core Services make up about 65% of the Consumer Price Index and include housing, healthcare, and insurance.

On the positive side of the inflation ledger were durable goods (motor vehicles, furniture, electronics, etc.), where prices dropped even faster in August, and energy, where prices dropped across the board, while food prices remained roughly stable, according to the Bureau of Labor Statistics today.