US inflation hits 8.3% in August, as food prices climb to 43-year high

The United States inflation slowed to 8.3% in August, the second drop in two months after hitting 9.1% in June, a four decades high. Last month’s rate fell below the 8.5% level reported in July.

Bureau of Labor Statistics disclosed that inflation fell on the back of a cut in prices of used and new cars, airfares, as well as gas, with the latter falling to $3.71 in August, below the $5 recorded in June.

Although the food index was up, rising to 11.4%, just as other goods and services prices – excluding energy and food costs – remain high at 6.3%, in contrast to July’s 6.1%.

Read also:Nigeria’s GDP slows to 3.54% y/y in Q2 on lower oil output, inflation

The rate level of food prices is reported as the largest increase since the end of May 1979, and the United States Federal Reserve is projected to raise the benchmark interest rate by 75 basis points next week to forcefully bring down inflation.

Recall that the Federal Reserve had made a similar 75 basis points raise in July, and the chair of the Federal Reserve, Jerome Powell, had hinted on a replica decision when the central bank meets this month.

Powell warned that the government will take strong action that could result in pain for Americans, and could threaten employment levels, as well as spending power.

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