Consumer prices rose 0.3 percent in August and 5.3 percent over the past 12 months, according to data released Tuesday by the Labor Department 

Monthly growth in the consumer price index (CPI), a closely watched gauge of inflation, fell for the second consecutive month, dropping from a July increase of 0.5 percent. Economists expected the CPI to grow by 0.4 percent last month.

Annual growth in the CPI — one of several ways to measure yearly inflation — also fell from a 5.4 percent rate in July, the highest rate since August 2008. Excluding food and energy prices, which are more volatile, the CPI rose 4 percent over the past 12 months and just 0.1 percent in August.

While inflation remains close to decade-plus highs, the continued slowdown in price growth may help President BidenJoe BidenBiden stumps for Newsom on eve of recall: ‘The eyes of the nation are on California’ Biden looks to climate to sell economic agenda Family of American held hostage by Taliban urges administration to fire Afghanistan peace negotiator MORE and Democrats soothe concerns about the rising cost of living as they attempt to pass a sprawling economic agenda. Republicans have sought to blame Biden and congressional Democrats for the recent run-up in price growth with slightly more than a year until the midterm elections.

The decline may also relieve some pressure on the Federal Reserve to begin pulling back on bond purchases meant to keep borrowing costs low, especially as the delta variant continues to roil the U.S. economy.

“The August CPI report showed further moderation in the monthly gain in consumer inflation, especially at the core level,” wrote Kathy Bostjancic of Oxford Economics.

“Headline CPI advanced by a solid 0.3%, though this is much softer than the outsized increases recorded in the prior five months,” she added. 

Economists expected inflation to cool slightly after a summer rush of travel and leisure spending drove price growth to remarkably high levels following steep declines in 2020.

Prices for airline fares, used cars and trucks, and motor vehicle insurance all fell in August after skyrocketing through most of the spring and summer. The CPI for used autos, which drove much of the summer’s increase in inflation, fell 1.5 percent in August but is still 31.9 percent higher than the same point in 2020.

Monthly inflation for groceries, restaurant and takeout meals, new vehicles, and shelter also fell in August. The rate of price growth for gasoline rose 0.4 percent in August, but the cost of fuel oil fell 2.1 percent last month as well.

The slowdown in inflation comes at a critical time for Biden and congressional Democrats as they race to write and pass a multitrillion-dollar infrastructure and social services bill, strike a deal with Republicans to fund the federal government and raise the country’s borrowing limit.

Sen. Joe ManchinJoe ManchinBiden looks to climate to sell economic agenda Tester says ‘100 percent’ of reconciliation package must be paid for Overnight Energy & Environment —

“It makes, in some ways, operations more efficient,” she said, “but at what cost?”

Some hotels have said that they are following the lead of consumers, many of whom were in favor of eliminating daily housekeeping during the pandemic, according to a survey by the American Hotel and Lodging Association last August. Hilton announced in July that it would make daily housekeeping optional for most of its U.S. hotels, with the exception of its luxury brands like Waldorf Astoria and Conrad. And Julie Rollend, Marriott’s director of public relations, said that company was leaving it up to guests to “elect their preferred cadence of housekeeping services during their stay.”

“Throughout the pandemic, we discovered guests enjoyed the flexibility of on-demand housekeeping services and have varying levels of comfort with someone entering their rooms after they have checked in,” Meg Ryan, Hilton’s senior director of corporate affairs, said in an email. She added that the hotel still offers room cleaning upon request, and that “the single biggest challenge for the industry right now is the availability of labor.”

Christopher Anderson, a professor at Cornell University’s School of Hotel Management, said that post-pandemic there is “more acceptance of reduced in-stay attention” among consumers, and that he could see an a-la-carte model similar to that adopted by many airlines becoming more popular, in which guests can choose the services for which they are willing to pay.

“I think as we reduce the actual labor, then firms can operationally deliver upon what they can deliver via technology, and then it now becomes a win-win,” Mr. Anderson said. “Consumers get more of what they want as far as selection, and then if costs are reduced and prices are adjusted accordingly, again, that’s a further win.”

But some employees say they would be the losers. A recent report by Unite Here, a hotel workers’ union, found that eliminating daily housekeeping as the industry standard would cost at least 180,000 jobs, held overwhelmingly by women of color, and $4.8 billion in lost wages.

Fifty-six percent of travelers told Discover they’ll use contactless payment methods more often while on trips this year.

martin-dm | E+ | Getty Images

Most news about travel may have focused on health and safety since the pandemic hit over a year ago. However, cost and booking flexibility are now even more top of mind for Americans looking to finally get away again, according to Discover Financial Services.

The credit card company’s latest annual travel survey, released Tuesday, finds that the 70% of consumers willing to travel again place price and flexibility ahead of the spread of Covid variants, infection rates at destinations or accommodations’ cleanliness ratings when considering a trip. Additionally, 87% of those surveyed said cost was an important factor in booking, and 86% cited flexibility of cancellation policies.

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Health and safety concerns, meanwhile, lagged price, but not by much: 80%, meanwhile, pointed to news of Covid variants and/or the number of new infections at a destination, and 74% said they’d prioritize sanitization efforts when making an accommodations choice.

 “It’s clear consumers have a strong desire to travel again as we head into the summer months and the economic recovery continues,” said Jacob Ayoub, vice president of consumer and competitive insights at Discover, in a statement. “We know travel trends and consumer needs are going to continue to shift, but it’s important to note that, right now, U.S. consumers are considering costs, flexibility and the spread of Covid-19 while traveling.”

The survey also addressed which Americans are traveling and why (see chart below).

Who’s traveling … and why

Sixty-six percent of consumers are planning trips of 1 to 6 days, and they’re traveling:

  • To relax: 37%
  • To visit family and friends: 18%
  • For a change of scenery: 10%

Among generations, here’s how interest in family trips vs. adventure travel compares:

  • Baby boomers: 28% family, 7% adventure
  • Gen X: 18% family, 10% adventure
  • Millennials: 12% family, 12% adventure
  • Gen Z: 9% family, 21% adventure

Source: Discover Financial Services/Dynata survey, April 2021

In some cases, willingness to spend more is related to health and safety concerns. Half of all respondents, for example, told Discover they’d be more likely to splurge on pricier trips if they include stricter Covid-19 hygiene protocols, and 49% would invest in priority travel passes to avoid crowds. Two out of 3 travelers surveyed said they’d continue to wear masks while traveling — even when not required — with 62% saying they’re hesitant to use transportation where they’ll be in close proximity to strangers.

When it comes to paying, 55% of travelers told Discover that credit cards are the preferred method — a 16-point jump from 2019. That may be tied to another survey finding, that 56% will use contactless payment options more often while on the road.

“For many consumers, the pandemic may have shifted

Continued financial challenges and mergers from airlines will likely proceed to have a unfavorable impression on the bonds they form with consumers. Brand Intimacy is difficult both to achieve and to take care of.

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U.S. President Joe Biden leaves after speaking about the coronavirus disease (COVID-19) response and the vaccination program from the Rose Garden of the White House in Washington, U.S., May 13, 2021. REUTERS/Kevin Lamarque

High unemployment. Rising prices. Gas lines.

They’re a bad memory for Americans old enough to remember the 1970s – but they’re also likely causing a few sleepless nights in the White House, as the United States’ economic recovery from the unprecedented coronavirus recession hits some bumps.

The jolts are dampening consumer confidence, ramping up inflation fears, and helping Republicans build their case against President Joe Biden and his ambitious plans to revamp the U.S. economy with trillions in new spending.

As the 1970s show, high joblessness and rising prices the United States saw in April can be a potent political force.

Republicans crafted a “misery index” out of the two factors to attack then-president Jimmy Carter. After hitting 75% approval ratings early in his presidency, the Democrat was trounced in a 1980 landslide.

Support for Biden remains strong and U.S. equity markets remain near record highs.

The White House says there’s bound to be surprises as the United States emerges from an unprecedented pandemic.

“We must keep in mind that an economy will not heal instantaneously,” Cecilia Rouse, the chair of the White House Council of Economic Advisers told reporters Friday. “It takes several weeks for people to get full immunity from vaccinations, and even more time for those left jobless from the pandemic to find and start a suitable job.”

Rouse, speaking to reporters at the White House, said a mismatch between supply and demand due to the pandemic and the economic snap-back had pushed inflation higher but that the mismatch should prove temporary.

“I fully expect that will work itself out in the coming months,” she said.

The Federal Reserve also is betting heavily inflation will cool on its own, even as hiring picks up steam over the summer, Americans start to travel again, and the Fed keeps its massive crisis levels of support intact.

The White House wouldn’t offer a timeline for when the economy will smooth out. But it doesn’t expect a repeat of April’s weak jobs report, and recent data show applicants for unemployment benefits fell to a 14-month low.

“The trend lines continue to be positive,” a senior White House official told Reuters on Wednesday. The White House also believes the Fed can handle what comes up, he said.

“We haven’t seen anything that is suggested that the Fed doesn’t have an ample toolkit to manage any of the risks that might present themselves.”

ROUGH WATERS AHEAD

Still, there’s more turmoil in months to come.

Republicans, divided by former President Donald Trump’s false claims that the 2020 election was stolen from him, have seized the moment to knock the foundation of Biden’s economic plans – raising taxes on the wealthy and companies.

“You won’t find any Republicans who are gonna go raise taxes. I think that’s the worst thing you