In August 2024, core consumer prices in the U.S. rose by 0.3%, exceeding expectations and reflecting an annual increase of 3.2%. Housing costs were a significant driver of this rise, with the Owners’ Equivalent Rent (OER) increasing by 0.49%, marking its highest monthly gain since January. This uptick in core inflation, alongside a 0.2% rise in the overall CPI, has reduced the likelihood of the Federal Reserve implementing a half-point interest rate cut, with markets now expecting a 25 basis point reduction instead. The ongoing increase in housing demand, partially fueled by a significant surge in the U.S. population, has contributed to persistent shelter inflation. Analysts should consider these demographic and market trends when evaluating future inflation pressures. The Bureau of Labor Statistics' recent changes to CPI calculation methodologies highlight the complexities of accurately assessing core inflation metrics.