US consumer prices up again, rising 5.4% in past year

As some pandemic restrictions are lifted, economy rebounds, but slowly

As pandemic restrictions are lifted, the economy slowly rebounds.

US prices jumped again in July, but at a slower pace than in the prior month, according to government data released on Wednesday, as some impacts of the Covid-19 pandemic shutdowns appeared to dissipate.

The consumer price index rose 0.5 per cent last month, seasonally adjusted, after a 0.9 per cent surge in June, the Labour Department said.

Energy prices remained a key driver of inflation, jumping 1.6 per cent, while food prices rose 0.7 per cent, the report said.

But when volatile food and energy goods are left out of the calculation, the core CPI rose just 0.3 per cent, seasonally adjusted.

Over the latest 12 months consumer inflation increased 5.4 per cent, unadjusted -- the same rate as in the prior month, but the core rate slowed to 4.3 per cent.

Energy prices collapsed when the Covid-19 restrictions forced business and transport to largely shut down, but as widespread vaccinations allowed the economy to begin to return to normal, gasoline prices have surged, rising 41.8 per cent compared to July 2020, the report said.

The reopening also led to other disruptions, including rental car companies rushing to restore their fleets to meet demand from traveling Americans, which drove used car prices to double digit increases in recent months; however they managed to edge up just 0.2 per cent compared to June.