WASHINGTON — Consumer prices in August posted the first monthly decline in nearly two years as Americans finally got some relief from surging energy prices. But the cost of food and clothing still rose last month and wages over the past year are down.
Consumer prices edged down 0.1 percent last month, the Labor Department reported Tuesday, a significant improvement from a 1.1 percent price spike in June and a 0.8 percent rise in July.
The cost of gasoline and other fuels plunged during the month, reflecting big drops in crude-oil prices since they peaked at $147 per barrel in early July.
Analysts said the August decline should be followed by more price moderation in coming months if prices continue falling. This will give the Federal Reserve more room to cut interest rates if needed to combat the current severe bout of market turmoil as Wall Street undergoes its biggest restructuring since the 1930s.
