Involved Inflation

August CPI rose a sharp 0.6% M-o-M, largely attributable to costlier gasoline. Core inflation rose 0.3% M-o-M, its highest reading since May, but just 4.3% Y-o-Y, its lowest reading since 9/21 and its 10th decline in 11 months. However, core services rose 0.6% M-o-M, unchanged since March. The Fed’s favorite, core services minus housing rose 0.4% M-o-M its highest reading since March. While generally falling, inflation remains uncomfortably high.