Following last month's modest miss in CPI which sparked speculation about a 50bps cut, which was then boosted by the jobs report miss and the huge downward revision, moments ago the BLS reported that - as only a handful of Wall Street strategists warned - CPI actually came in hotter than expected at the core level, rising 0.3% MoM vs expectations of a 0.2% print, with all remaining metrics coming in line, to wit:

And visually, here is the headline print, where the annual CPI increase dropped to just 2.5% from 2.9%, the lowest since February 2021...

... and the core....

.... as goods deflation is stalling and may even print positive in the coming months, while core service inflation remains the biggest driver.

That was s the 51st straight month of MoM increases in Core CPI, and a new record high.

Under the hood, used car prices fell 1.0%, moderating from last month's 2.3% drop, while airline fares jumped 3.9%, a big reversal to last month's bizarre -1.2% drop and a reversal to drops in each of the past 5 months. Car insurance costs jumped another 0.6%, after rising 1.2%; furniture prices dropped 0.3% reversing last month's 0.3% rise.

Here is a more detailed breakdown:

Food:

The food index increased 0.1 percent in August, after rising 0.2 percent in each of the previous 2 months. The index for food at home was unchanged in August. Two of the six major grocery store food group indexes increased over the month while the other four indexes declined in August.

Energy

The energy index decreased 0.8 percent in August, after being unchanged in July.

All items ex good and energy

Visually:

Developing