Consumers spent a bit more in August, a sign the economy is holding up even as inflation lifts prices for food, rent, and other essentials. The Commerce Department said spending was up by 0.4% in August, after it fell 0.2% in July.
The two indexes differ for several reasons. For example, the consumer price index puts much greater weight on rents and housing costs, which have been rising steadily, than the measure released Friday, known as the price index for personal consumption expenditures.
, with core prices rising more quickly than headline inflation. Falling gas prices have reduced overall inflation, while stubbornly high costs for housing, cars, and services such as health care and hair cuts have pushed core prices higher. But over a longer time frame, incomes are trailing inflation. In the April-June quarter, inflation-adjusted disposable income fell 1.5% at an annual rate.most rapid series of interest rate hikes in four decades
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