US annual inflation eased last month but remains stubbornly high

Minneapolis (CNN Business)US inflation cooled off in August for the second-straight month but remained stubbornly high, according to data from the Bureau of Labor Statistics released Tuesday.

The Consumer Price Index, which measures a basket of consumer goods and services, showed prices were up 8.3% year on year, a slowdown from the 8.5% gain in July and the 9.1% spike in June. The last time the headline CPI rate declined in consecutive months was the first part of 2020.

On a monthly basis, consumer prices rose 0.1% from July.

The slower pace of annual price hikes comes alongsidea significant drop in gas prices,which have come down fromrecord highs set in June.

Core CPI, which strips out the more volatile categories like food and gasoline, measured 6.3% in August, up from 6.2% in July.

Still, inflation remains painfully high for many Americans, especially those with little wiggle room in their monthly budgets. Annual price gains are a far cry from where they were 18 months ago and from the Federal Reserve's target inflation rate of 2%.

"This is a fight we cannot, and will not, walk away from," Fed Governor Christopher Waller said last week, underscoring the central bank's laser focus on hitting its 2% goal.

The Fed has been tightening its monetary policy in recent months to help rein in the highest inflation in four decades, implementing back-to-back, super-sized rate hikes of 75 basis points.

Tuesday's report — especially core CPI — will be scrutinized by the Fed ahead of its policymaking meeting next week.

This story is developing and will be updated.