Slump continues with cost hikes

Source: Exec Digital USA

Date :8/14/2008 6:43:46 AM

The economic slump shows little sign of improvement with a rise in consumer costs together with a worsening labor market.

Consumer prices climbed at twice the rate expected in July and job prospects kept softening last week, according to Labor Department reports on Thursday, August 14.

The department's Consumer Price Index, the most commonly used inflation gauge, rose 0.8 percent in July and on a year-over-year basis jumped 5.6 percent.

Costlier energy and food helped push July prices up but, since that time, oil prices have begun to decline and analysts hoped that July might mark a watershed on inflation pressures.

The dollar rose and Treasuries fell after the data but quickly reversed course, with the dollar standing little changed on the day and government bond prices higher. Stock futures were lower.

US job markets are also severely strained, adding to the burden on consumers who fuel two-thirds of economic activity through their purchases of goods and services.