By CountingPips.com
U.S. Consumer Prices increased for the second month in a row as energy price increases helped push the index higher, according to a report released today by the U.S. Department of Labor. The Consumer Price Index, a key measurement of inflation, increased by 0.3 percent in August following an increase of 0.3 percent in July. Today’s data matched economic forecasts that were expecting a 0.3 percent increase. Consumer prices had been in decline for three straight 
months before July.
The annual rate of consumer prices rose by 1.1 percent when compared to August 2009 following an increase in July by 1.2 percent. Rising energy prices were a significant contributor in the increased inflation as the report showed that energy prices rose by 2.3 percent and gasoline prices increased by 3.9 percent for the month. Food prices rose by 0.2 percent in August after a 0.1 percent decline in July.
The core inflation reading, excluding volatile food and energy prices, was flat for the month and below the market forecasts expecting a 0.1 percent gain. The annual rate of core inflation increased by 0.9 percent for August following an increase of 0.9 percent in July.
US Dollar on defensive in Forex Trading
The U.S. dollar has been mostly lower in forex trading today against the other major currencies in the early going of the US trading session. The dollar has been gaining versus the Canadian dollar while trading lower against the British pound sterling, New Zealand dollar, Australian dollar, Swiss franc and the Japanese yen, according to currency data by Oanda. The dollar is currently trading almost unchanged against the euro at time of writing.
The US stock markets, meanwhile, have had a positive session to start the day with the Dow Jones rising by over 40 points, the Nasdaq increasing by over 10 points and the S&P 500 showing a quick 5 point gain. Oil has traded about unchanged at $74.60 while gold has risen to a new record high by gaining $7.70 to $1279.60 per ounce.
