By Claire West

Consumer prices in the OECD area1 rose by 1.6% in the year to August 2010, the same inflation rate as in July. Growth in energy prices slowed down to 4.8% in August compared with 6.2% in July, while consumer prices for food rose by 1.4% compared with 1.1% in July. Excluding food and energy, the annual inflation rate held steady at 1.2 % in the year to August 2010

Deflation continued in Japan for the nineteenth consecutive month with consumer prices falling by 0.9% in the year to August. Inflation decelerated slightly in all other G7 countries. Annual inflation was 1.7% in Canada (down from 1.8% in July), 1.6% in Italy (down from 1.7%), 1.4% in France (down from 1.7%), 1.1% in the United States (down from 1.2%) and 1.0% in Germany (down from 1.2%). Euro area annual inflation (HICP) was 1.6% in August, down from 1.7% in July.

Compared with the previous month, consumer prices in the OECD area increased by 0.2% in August while they remained stable the previous two months. They rose by 0.5% in the United Kingdom, 0.3% in Japan, 0.2% in France and Italy, 0.1% in the United States, and were stable in Germany.
Consumer prices decreased by 0.1% in Canada.